Peter Madoff Now to Pay for Role in Ponzi Scheme
Peter Madoff, the younger brother of Ponzi swindler Bernie Madoff, was arrested this morning and will appear in court later in the day as part of a process that will see him serve 10 years in prison for his role in the swindle.
Federal agents arrested Peter Madoff, 66, at about 7 am, CNBC has learned. He was taken to the FBI office in Manhattan for processing prior to an 11 am court hearing.
He arrived at the FBI office in a gold Chevrolet Impala at about 7:12 am.
Peter Madoff served as compliance officer at his brother's firm. The arrest comes three years to the day after Bernie Madoff was sentenced to 150 years in prison for running the multibillion dollar Ponzi scheme that robbed hundreds of their life savings.
The proceeding in which Madoff is agreeing to serve 10 years and prison and surrender his assets will let investigators show what they have learned about the largest Ponzi scheme ever prosecuted since Bernard Madoff revealed in December 2008 that his investment business was a sham.
The government has used the cooperation of six former employees and associates of the Bernard L. Madoff Investment Securities to learn what went on inside the secretive business that caused close to $20 billion to vanish, leaving only a few hundred million dollars where bogus financial statements claimed there was $65 billion.
The plea by Peter Madoff to conspiracy and falsifying records charges links him again to his notorious brother, reviving a relationship in which he kept firmly behind the scenes as Bernard Madoff provided the face of the investment firm that attracted rich and famous clients with too-good-to-be-true returns.
In his 2009 guilty plea, Bernie Madoff maintained that his brother had nothing to do with it —and for more than three years, his brother stuck to the script.
—The Associated Press contributed to this report.