Defense: Madoff kept employees in dark about fraud

Bernard Madoff’s operating chief, Daniel Bonventre (above), ran the firm’s legal side, his lawyer said.
Brendan McDermid/Reuters/File
Bernard Madoff’s operating chief, Daniel Bonventre (above), ran the firm’s legal side, his lawyer said.

NEW YORK — Bernard Madoff was a Wall Street rock star who charmed billionaires, celebrities, regulators, and his employees, including five of his former workers who are on trial for fraud, defense attorneys told a jury Thursday in opening statements.

Lawyer Andrew James Frisch said Madoff and his former finance chief — government cooperator Frank DiPascali — were ‘‘depraved and pathological’’ as they delivered millions of lies to disguise a fraud that cheated thousands of investors out of billions of dollars.

On Wednesday, a prosecutor accused the five former employees of being crucial components of a fraud that was hidden for decades, but defense lawyers insisted Thursday that their clients were fooled in the same way Securities and Exchange Commission inspectors and financial experts were.


Frisch portrayed his client, Daniel Bonventre, as enamored of Madoff. Bonventre, 66, rose to director of operations after joining the firm in the 1960s. He oversaw the legitimate side of Madoff’s business, not the secretive private investment wing, Frisch said.

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Roland Riopelle, attorney for Madoff’s longtime secretary, Annette Bongiorno, said his client, too, was taken in by ‘‘a kind of rock star in the securities industry.’’ The government “simply cannot prove that she knew there was a fraud,” he said.

Bongiorno started working for Madoff in the 1960s, when she was 19, and eventually became a supervisor, responsible for maintaining the accounts of longtime customers, Riopelle said. He noted that she kept her money in the company’s accounts until the fraud was revealed.

Frisch described Madoff as a ‘‘Wall Street icon,’’ someone as large in stature as Donald Trump or Oprah Winfrey.

Also on trial are JoAnn Crupi, an account manager, and computer programmers Jerome O’Hara and George Perez. They pleaded not guilty.


On Wednesday, Assistant US Attorney Matthew Schwartz said no one would dispute Madoff told many lies.

‘‘But the evidence will show that these defendants knew exactly what they were doing. . . . They did it because Bernard Madoff encouraged it and they were getting rich in the process,’’ he said.

The 2008 collapse of Madoff’s investment business cost clients nearly $20 billion. A court-appointed trustee has recovered much of the money.

Madoff admitted the nearly $68 billion he claimed existed in accounts was only several hundred million dollars. The Ponzi scheme nearly ran out of money at least twice before collapsing during the 2008 financial crisis.

Madoff, 75, is serving a 150-year prison sentence.