With the walls closing in on his decades-long Ponzi scheme, Bernie Madoff cried to his top lieutenant, “The whole goddamn thing is a fraud.”
“He said, ‘I’m at the end of my ropes,’” Madoff’s former right-hand man, Frank DiPascali, told jurors in Manhattan federal court Tuesday, at the trial of five staffers of the sham investment firm.
“‘I don’t have any goddamn money. Don’t you get it? The whole goddamn thing is a fraud,’” a weeping Madoff told him.
The stunning peek into the final days and hours of the $65 billion swindle was offered a day before the five-year anniversary of Madoff’s Dec. 11, 2008 arrest. Prosecutors played on the timing to steer DiPascali — an admitted accomplice turned star government witness — into providing the most in-depth look at a crumbling Madoff as he realized the feds were closing in.
Madoff’s former chief financial officer said sometime in late 2008, Madoff was “staring at a window all day” before calling him in to his office to discuss how the firm was in dire straits because customers were seeking to cash in their accounts in light of the credit crunch.
A “crying” Madoff also confided how he had just called attorney Ira Sorkin to make arrangements to turn himself in, saying, “ ‘The last thing I want to do is go out of this place in handcuffs. I want to go out on my terms,’” DiPascali recalled.
The notorious con man also told him he had put tens of millions of dollars of his assets in his wife Ruth’s name and then asked DiPascali if his wife, Joan, was also taken care of.
“Ruth will be OK,” DiPascali recalled Madoff saying. “Is Joan going to be OK? Are your kids going to be OK?”
DiPascali said his own “knees buckled” as Madoff cried his heart out because, “I knew it meant I am not going to be around much longer” as he realized “the whole shooting match is going right down the toilet and we’re all going to get arrested.”
DiPascali said he put his foot down when Madoff talked about using some of firm’s remaining cash to pay off top clients. He said he told Madoff that the “honorable” thing to do is first make sure his employees who invested in the firm’s bogus investment advisory account are taken care of.
“I [reminded him] he had 200 or so employees who will be out on the street and will be out jobs,” DiPascali said.
The five on trial are Madoff’ staffers Annette Bongiorno, Joann Crupi, Daniel Bonventre, George Perez and Jerome O’Hara.
Madoff pleaded guilty and is serving a 150-year prison term. DiPascali pleaded guilty in 2009 and agreed to cooperate to shorten the 125-year sentence he faces.