Bernie Madoff (Reuters)
Oh, brother.
The younger sibling of Bernie Madoff said yesterday he thought his brother was only a little bit crooked — and was “shocked” upon learning that Bernie is the biggest con man of all time.
“In December of 2008, when my brother told me about his fraud, I was in shock, and my world was destroyed,” Peter Madoff said yesterday as he pleaded guilty in Manhattan federal court to conspiracy and falsifying records for his brother’s benefit — and his own.
“I am deeply ashamed and terribly sorry. I know that my conduct was wrong,” Peter, 66, told Judge Laura Taylor Swain, detailing how he and Bernie (pictured) cheated to scam the government out of taxes.
Still, Peter maintained, he didn’t know the brother he idolized was running a multibillion-dollar Ponzi scheme.
“I truly believed that my brother was a brilliant securities trader who successfully traded for customers’ accounts. In fact, I encouraged my own family to invest millions of dollars in accounts managed by my brother.”
But all the money they “made” was an illusion.
“My family was torn apart as a result of my brother’s atrocious conduct, and I became reviled by strangers, as well as former friends who assumed that I had known about the Ponzi scheme.”
He said he’d worked for his brother for 38 years, and “he rewarded me with substantial compensation and gifts” — gifts that should have clued him in to the fact that his brother was a crook.
Peter said that “on several occasions, my brother and I engaged in money transfers in ways specifically designed to avoid payment of taxes. I knew that this conduct was wrong.”
In a filing yesterday, the Securities and Exchange Commission contended that Peter hadn’t done any review at all, and just rubber-stamped whatever his brother wanted. In court, prosecutor Lisa Baroni said in one instance, Peter “signed many weeks of compliance reports in one sitting, intentionally changing pens and ink colors in order to disguise the fact that he created them at one time and that they were false.”
Peter was freed on $5 million bond pending his sentencing on Oct. 6. He’s expected to get 10 years behind bars, and as part of his plea agreement with government, agreed to a symbolic $143 billion forfeiture. That means his homes in the Hamptons, Manhattan, Palm Beach and elsewhere are toast, as is his 1995 Ferrari Spyder.
US Attorney Preet Bharara said Peter had “enabled the largest fraud in human history,” and will “now be jailed into old age” while forfeiting “virtually ever penny he has.”
Bharara added that the investigation into the case is continuing.
Additional reporting by Bruce Golding