|
 "He said, 'Frank, the FBI is in the office with my brother,'"
DiPascali said in federal court in New York on Wednesday. "I said,
'Why are you calling me?' And I threw my phone across the room."
The longtime Madoff deputy was speaking on the fifth anniversary of
Madoff's arrest on Dec. 11, 2008, which marked the collapse of
his decades-long Ponzi scheme.
DiPascali, who has pleaded guilty to his part in the scheme, was
testifying at the trial of five former Madoff employees who are
charged with helping the financier conceal his fraud from customers,
government regulators and Wall Street.
The defendants — back-office manager Daniel Bonventre, portfolio
managers Joann Crupi and Annette Bongiorno, and computer programmers
Jerome O'Hara and George Perez — have denied the allegations. They
claim Madoff convinced them that the business was legitimate.
Madoff is serving a 150-year prison sentence. He has denied that the
five defendants aided in his scheme.
FAKING OUT THE FEDS
In a week of testimony so far, DiPascali has said all five took part
in creating fake records to hide the fact that no trading was
occurring in any customer accounts.
On Tuesday, DiPascali had testified that Madoff told him that the
firm was broke only days before he was arrested.
As the trial continued on Wednesday, DiPascali said he then
panicked, throwing an unregistered gun he had received as a gift
into his pond and destroying a flash drive that contained evidence
of fake records.
"It was ridiculous," he said, because he knew there were other
copies at the office.
At the office in New York on Dec. 10, he said he saw Bernard Madoff's wife, Ruth, and that she looked "catatonic," adding that it
was obvious to him Madoff had told her about the fraud's extent.
"I touched her cheek and said, 'Ruthie, it's going to be OK,'" he
testified.
"Did you believe it was going to be OK?" Assistant U.S. Attorney
John Zach asked.
"No," DiPascali said.
On his way to the office on Dec. 11, he got a call from Peter Madoff, Bernard's brother, telling him that Bernard Madoff had been
taken into custody. Throughout the day, DiPascali provided falsified
records to federal agents and lied to them about what he knew, he
said.
[to top of second column] |
At one point, Peter Madoff walked into the conference room where
investigators had convened and dropped stacks of records for the
firm's main bank account at JPMorgan Chase & Co, DiPascali said.
Under his breath, Peter Madoff said "something to the effect of,
'This is where the secrets are,'" DiPascali testified.
Zach then took DiPascali through his decision to cooperate and
eventually plead guilty, asking him what had happened to his house,
his cars and his boat, all of which were seized by federal
authorities.
"How much money do you have right now on your own?" Zach asked.
"The $14 in my pocket," replied DiPascali, who is out on bail, but
under house arrest.
He faces up to 125 years in prison.
Later on Wednesday, Larry Krantz, the defense lawyer for Perez,
began what is likely to be several days of cross-examination by
emphasizing that DiPascali spent the better part of three decades
lying to customers, regulators and fellow employees about the fraud,
in an effort to undermine his credibility as a witness.
"Is it fair to say that you got pretty good at conning people?" he
asked.
"I never took a survey," DiPascali answered.
The case is USA v. O'Hara et al, U.S. District Court for the
Southern District of New York, No. 10-cr-0228.
(Editing by Jan Paschal)
[© 2013 Thomson Reuters. All rights
reserved.] Copyright 2013 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
 |
