Madoff's Brother Pleads Guilty
Three years to the day his older brother was sentenced to 150 years in prison, Peter Madoff pleaded guilty to two charges linked to Bernie Madoff's $65 billion Ponzi scheme.
FBI agents arrested 66-year-old Peter Madoff at his lawyer's New York City offices at 7:00 a.m. Friday. He was later taken to Federal Court in lower Manhattan, where he pleaded guilty to conspiracy to commit securities fraud and falsifying records.
The judge set bail at $5 million. Madoff and his wife must give up their passports and are not permitted to leave the Southern and Eastern Districts of New York State. His sentencing is set take place Thursday, October 4.
This makes the Old Westbury Long Island native the first family member and eighth Madoff employee to plead guilty in connection with the massive scheme. Though like all the others save for Bernie, the 40-year veteran of his brother's firm did not plead guilty to the fraud itself.
Now imprisoned in the Butner Federal Corrections Complex in North Carolina, 74-year-old Bernie Madoff has consistently said he alone masterminded the decades-long fraud that cost thousands their life savings.
As part of his plea deal, Peter Madoff will serve a ten-year sentence and agreed to the criminal forfeiture of $143.1 billion dollars in assets. This means he will actually forfeit all his personal property and assets. The $143.1 billion a largely symbolic figure representing all the scams funds that can be linked to Peter as a former employee of the firm.
A lawyer, Peter Madoff served as Bernie Madoff's general counsel and chief compliance officer during his forty years at Madoff's firm.
Madoff trustee Irving Picard, charged with recovering and distributing assets to Madoff clients, sued Peter Madoff and three other family members who worked at the firm in October of 2009. Picard claimed they used the firm as their personal piggy bank, and as overseers of trading, legal and compliance at the firm were derelict in not detecting the fraud.
One of those family members is Shana Madoff Swanson. Peter Madoff's daughter and a lawyer herself, the Wall Street Journal reports she remains a person of interest for prosecutors along with Bernie Madoff's surviving son Andrew. Shana worked in the legal arm of the firm. Andrew, along with his deceased brother Mark, served as co-heads of the firm's trading operations, a legitimate enterprise separate from the money management arm where his father ran the Ponzi scheme.
Andrew has denied knowing anything about the fraud. So did his brother Mark, who committed suicide two years to the day his father admitted to the fraud.