White-Collar Crime

Jury convicts 5 Madoff staffers; accountant is now last remaining defendant in $17.5B scheme

After the conviction Monday of five employees who helped Bernard L. Madoff perpetrate a massive Ponzi scheme under the guise of a hedge fund, only one defendant still remains to be tried in a criminal case linked to the $17.5 billion swindle.

He is Paul Konigsberg, 77, an outside accountant charged with conspiracy and filing falsified business records, the New York Daily News reports.

Convicted on all 31 counts Monday by a federal court jury in New York after a six-month trial and two weeks of deliberation were Annette Bonjiorno, 66; Daniel Bonventre, 67; Joann Crupi, 53; Jerome O’Hara, 51; and George Perez, 48; according to Bloomberg News, Politico and the New York Times’ DealBook blog (reg. req.).

Including Madoff himself, who is serving 150-year prison term, nine individuals have previously taken pleas, for a total of 14 convicted in connection with his fraud.

The defense argued that the five workers were unsophisticated and unaware of Madoff’s Ponzi scheme, but jurors didn’t buy the argument. Two defendants who took the stand weren’t persuasive, several members of the panel told Bloomberg.

‘‘It was embarrassing for them, because they weren’t telling the whole truth. I can tell you I didn’t believe them because of their body language and their voices,’’ said juror Nancy Goldberg, who works as an instructional assistant at a suburban high school. ‘‘Taking the stand was a big mistake because it was an embarrassment to watch them.”

Each of the five defendants was convicted of securities fraud, conspiracy to defraud clients and falsifying the books and records of a broker dealer, the Associated Press reports. They are scheduled to be sentenced in July.

“The trial established that the Madoff fraud began at least as far back as the early 1970s, decades before it came to light,” said Manhattan U.S. Attorney Preet Bharara, noting that his office has contended for years that the Ponzi scheme was too big for one individual to have carried out alone. “These defendants each played an important role in carrying out the charade, propping it up and concealing it from regulators, auditors, taxing authorities, lenders and investors.”

Lawyers for the defendants said they are disappointed. Bonventre’s lawyer, Andrew Frisch, says he will appeal, the AP article reports.

“The name Madoff was a tall mountain to climb. I think it’s just a fact,” said defense attorney Eric Breslin. He represented Crupi in the case.

See also:

ABAJournal.com: “Madoff’s $17B fraud began in 1970s, witness says in testimony against former colleagues”

Reuters: “Former Madoff associates found guilty of fraud”

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