Madoff’s Inner Circle Faces Sentencing for Largest Ponzi Scheme in History
Daniel Bonventre, former director of operations for imprisoned financier Bernard Madoff, arrives at federal court for a sentencing hearing, Monday, Dec. 8, 2014 in New York. He's the first of five Madoff ex-employees to learn their fate in the coming days after a jury convicted them earlier this year of charges related to the multi-decade, multi-billion dollar fraud. (AP Photo/Mark Lennihan)
It took more than Bernard Madoff alone to pull off the largest Ponzi scheme in U.S. history. On Monday, the first of five members of his inner circle to be convicted in connection to the epic fraud case was sentenced to 10 years in prison.
In addition to prison time, Daniel Bonventre, a former operations director for Madoff, was ordered to forfeit $155 billion for his role in the scheme. Madoff has maintained for years that he acted alone in the investment scam, but in March, following five months of trial, a federal jury ruled that Bonventre helped facilitate the fraud by producing phony books and records.
Bonventre’s sentencing comes nearly six year to the day of Madoff’s arrest by federal agents. The continuing fallout from the case underscores the depth of a massive fraud. In all, investors were cheated out of $17.5 billion in principal, as well as another $47 billion in made-up profits that they believed had been gained by Madoff on their behalf. As of November, a court-appointed trustee has recovered $10 billion of that amount for victims.
At his sentencing hearing on Monday, Bonventre maintained his innocence, telling the court, “I was used by the ultimate con-man. He was a manipulator beyond manipulator.”
But the federal judge in the case, Laura Swain, was unmoved. While Bonventre “was not a coldly calculating, knowing participant in the Ponzi scheme,” Swain said, he was nonetheless “a pampered, compliant and overcompensated worker who willfully blinded himself to inconvenient truths.”
Convicted alongside Bonventre were portfolio managers Annette Bongiorno and JoAnn Crupi, who were both accused of concocting fake trading records for Madoff, and computer programmers Jerome O’Hara and George Perez, who were charged with drawing up phony customer accounts. All four will be sentenced later this month. They face prison terms ranging from eight to 20 years.
The case doesn’t end with Madoff’s inner circle, however. In December 2012, his younger brother, Peter Madoff, was sentenced to 10 years in prison for his role in the operation. Madoff’s former accountant, his onetime controller and his ex-finance chief have all pleaded guilty and will face sentencing next year.
Madoff is currently serving a 150-year prison sentence in North Carolina. Asked from prison in March whether he had advice for investors, Madoff recommended they stay away from the stock market. He said he was certain that there are other “bad players like myself.”