World Bulletin/News Desk
Bernard Madoff's younger brother pleaded guilty to criminal charges that he helped advance the multibillion-dollar Ponzi scheme but denied knowing about the epic, decades-long fraud.
Peter Madoff's guilty plea in Manhattan federal court on Friday marks the first time since Bernard Madoff himself that a family member has admitted criminal wrongdoing at the investment advisory firm.
"I truly believed that my brother was a brilliant securities trader," Peter Madoff told U.S. District Judge Laura Taylor Swain in Manhattan.
Peter Madoff, 66, had been chief compliance officer at Bernard L. Madoff Investment Securities LLC and said Friday that he did not know the business was a sham until Bernard Madoff confessed to him in December 2008.
"I want to apologize to anyone who was harmed and to my family," Peter Madoff said, standing at the defense table and reading for 15 minutes from typed notes, his voice breaking at times.
Peter Madoff will be sentenced on Oct. 4, and has agreed to accept a 10-year prison term. He was also ordered to forfeit a symbolic $143.1 billion, and is expected to be released on a $5 million bond.
Bernard Madoff, 74, is serving a 150-year prison term and was ordered to forfeit $170.8 billion.
More to come?
About a dozen people have been charged in connection with Madoff's Ponzi scheme, and U.S. Attorney Preet Bharara in a statement suggested that prosecutors may not be done.
"Peter Madoff enabled the largest fraud in human history," Bharara said. "He will now be jailed well into old age, and he will forfeit virtually every penny he has. We are not yet finished calling to account everyone responsible for the epic fraud of Bernard Madoff and the epic pain of his many victims."
Prosecutors have not said whether criminal cases are also being prepared against Bernard Madoff's son, Andrew, who was co-director of trading, or his niece, Shana, who was a compliance officer at the firm.
Five people implicated in criminal wrongdoing related to Madoff's firm have pleaded not guilty: Annette Bongiorno, Daniel Bonventre, Joann Crupi, Jerome O'Hara and George Perez.
Among others to have pleaded guilty is Frank DiPascali, the firm's former chief financial officer, who has been cooperating with the government since his plea nearly three years ago.
At his plea hearing, Peter Madoff admitted guilt over a series of money transfers between himself and his brother, though he claimed to have once believed they were legitimate.
He also said he lied when certifying that he had conducted a thorough review of the firm's compliance with regulations.
"I made no effort to conduct a meaningful compliance review," he said.
A chief architect
The FBI called Peter Madoff one of the "chief architects" of his older brother's Ponzi scheme, which was uncovered when Bernard Madoff was arrested on Dec. 11, 2008.
"Peter Madoff played an essential enabling role in the largest investment fraud in U.S. history," FBI Assistant Director Janice Fedarcyk said in a statement. "He made a pretense of compliance. He was really about complicity."
Peter Madoff was arrested at his lawyer's office on Friday morning, FBI spokesman Peter Donald said.
He still faces a lawsuit by Irving Picard, the trustee seeking money for victims of the Ponzi scheme, who has sued Peter Madoff and other family members for $255.3 million.
The trustee charges they should have detected Bernard Madoff's Ponzi scheme at the firm that operated "as if it were their family piggy bank."
Picard also sued Andrew Madoff; the estate of son Mark, co-director of trading who committed suicide in December 2010; and Shana Madoff.
The trustee has described Peter Madoff as a savvy investor who once served as vice-chairman of the board of governors of the Financial Industry Regulatory Authority. He is seeking $90.4 million from Peter, $81.3 million from Mark Madoff's estate, $73.8 million from Andrew and $15.3 million from Shana.
Lawyers for Andrew and Shana Madoff did not immediately return calls seeking comment.
Between 1993 and 2008, Peter Madoff was paid over $36 million in salary and bonuses, Picard said, and the firm funded a lavish lifestyle that included $140,000 for a Ferrari in 1995 and a home on Manhattan's upscale Park Avenue.
Picard has estimated customers of the Madoff firm lost about $20 billion. On Monday, the U.S. Supreme Court let stand a lower court ruling on the trustee's methods for calculating losses. That decision could help Picard repay customers faster.
The case is U.S. v. O'Hara et al, U.S. District Court, Southern District of New York, No. 10-cr-00228.
Tunisians are expected to cast ballots in the elections inside Tunisia on Sunday. Around 5.2 million Tunisians, including 360,000 living outside the country, have the right to vote in the elections
Soldiers exchanged heavy fire with the militants, whose exact affiliation was unclear, and had surrounded them by midday, security sources said
A Kurdish intelligence officer in Zumar said peshmerga forces had advanced from five directions in the early morning after coalition air strikes on ISIL positions
458 candidates, including 97 women, find their way to provincial council seats; IEC Chairman blames delay in announcing results to technical problems
The United Nations General Assembly adopts resolution granting observer status to the Developing-Eight, or D-8.
The Palestinian youths pelted Israeli troops with stones and empty bottles, but the troops responded by firing teargas and birdshot, wounding ten Palestinians and making dozens of others experience temporary asphyxiation
More than 36 million citizens are set to vote and choose among 29 political parties in Sunday's early general election.
Qatar has renounced deporting Muslim Brothers leaders, Egyptian media reported.
Ismail Radwan said that the new round of indirect negotiations will start on Monday in Cairo as scheduled
60 % of French prisoners are Muslims “originally or culturally” according to French deputy Guillaume Larrive
Colorectal cancer is the leading cancer in males followed by leukemia and prostate cancer, according to the registry.
"Egypt is fighting an existential war," al-Sisi said, going on to say that his country will take "measures" along border with the Gaza Strip following the attack
Human Rights Watch calls for prosecution of military involved in killing 85 Muslims in southern Thailand
Kurdish media claimed the first units tomorrow to across Turkey's border, but news on when the peshmerga will start their passage is denied
Hamas said that two members had been detained in Bethlehem and two others in Hebron late Friday.
Jabbari had been sentenced to death in accordance "qisas" (eye for an eye) law after being found guilty of stabbing dead an older man with a kitchen knife seven years ago.