Two Madoff Workers Arrested, Charged With Conspiracy

Thursday, 18 Nov 2010 12:19 PM

 

  Comment  |
   Contact  |
  Print  
|  A   A  
  Copy Shortlink

Two longtime back office employees of Bernard Madoff were arrested Thursday on charges that they helped the disgraced financier dupe investors for decades by making fictitious investments — and that they cashed in on the epic Ponzi scheme themselves.

FBI agents arrested Joann Crupi at her house in Westfield, N.J., while Annette Bongiorno was picked up at her home in Boca Raton, Fla.

An indictment unsealed in federal court in Manhattan alleges Crupi, 49, and Bongiorno, 62, "'executed' trades in the accounts of (wealthy clients) only on paper ... and that achieved annual rates of return that had been predetermined by Madoff."

Prosecutors, citing internal communications, say Bongiorno used a computer program designed to backdate trades and manipulate account statements.

"I need the ability to give any settlement date I want," she wrote to a manager in the early 1990s, according to the indictment.

Crupi was charged with creating false records to cover Madoff's tracks amid reviews by the Securities and Exchange Commission. Prosecutors say that as the scheme unraveled, she "became aware that client redemption requests bore no relationship to (the business') cash on hand, which by late 2008 was woefully insufficient to meet those requests," the indictment said.

Seized records show that Bongiorno deposited about $920,000 in her own Madoff account from 1975 to 2008 and withdrew more than $14 million over the same period, the indictment said. Crupi received hundreds of thousands of dollars in "off the books" income, it added.

The women "protected and perpetuated the Madoff mirage while putting very real money in their own pockets," U.S. Attorney Preet Bharara said in a statement.

Crupi was due in Manhattan court Thursday, while Bongiorno will have an initial appearance in Florida. Both are charged with conspiracy, securities fraud and falsifying records.

Authorities filed civil papers in June seeking to recoup $5 million from the two employees. The government said in August that it had traced houses in Manhasset, N.Y., and Boca Raton, Fla., and other assets to Bongiorno.

Attorneys who represented the women previously did not immediately respond to phone and e-mail requests Thursday for comment.

Madoff is serving a 150-year sentence in federal prison after admitting that he operated his fraud for at least two decades, cheating thousands of individuals, charities, celebrities and institutional investors. Losses are estimated at around $20 billion, making it the biggest investment fraud in U.S. history.

Both Crupi and Bongiorno face up to 20 years in prison if convicted of the most serious charges.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

  Comment  |
   Contact  |
  Print  
  Copy Shortlink
Around the Web

Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 

You May Also Like
Around the Web

Most Commented

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved