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 Making closing arguments in New York federal court after five months
of testimony and a six-hour government summation, lawyers for the
defendants sought to undermine the testimony of former Madoff
lieutenant Frank DiPascali, who spent weeks describing how all five
defendants were complicit in a dizzying array of fraudulent
activity.
Larry Krantz, who represents computer programmer George Perez,
called DiPascali a "con man's con man" and said, "Mr. Perez was
used, abused and manipulated by two of the greatest criminal
masterminds of all time: Bernie Madoff and Frank DiPascali."
Eric Breslin, the lawyer for portfolio manager Joann Crupi, referred
to DiPascali's "corrupt and rotten essence, which permeated this
courtroom for a month."
The five defendants are charged with helping perpetrate a massive
Ponzi scheme at Madoff's investment firm. In addition to Perez and
Crupi, they include another computer programmer, Jerome O'Hara;
portfolio manager Annette Bongiorno; and the firm's operations
director, Daniel Bonventre.
All five have argued that they were duped by Madoff into thinking
the firm's investment advisory business was legitimate and only
later found out that no trading took place in that unit.
Madoff himself is serving a 150-year prison sentence after pleading
guilty to the scheme, which cost investors approximately $17 billion
in principal losses when it collapsed in 2008.
Prosecutors have said Perez and O'Hara wrote computer programs that
generated millions of false trading records to fool U.S. Securities
and Exchange Commission investigators and independent auditors.
Those programs included code that assigned random transaction
numbers, time stamps and even banking counterparties to make the
trading activity seem more real. There could be no legitimate reason
to create such code, Zach said in closing arguments earlier this
week.
The government also accused Crupi of backdating countless fake
trades in customer accounts, helping to forge documents for auditors
and overseeing cash flow in the bank account where the fraud was
centered.
Both Krantz and Breslin argued that their clients were just like
many other employees at Madoff's firm who participated in the fraud
without realizing what was happening, thanks to Madoff's talent for
deception.
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Breslin invoked Buell Frazier, the man who unwittingly drove Lee
Harvey Oswald to the book depository in Dallas on the day he
assassinated President John F. Kennedy and accepted Oswald's
statement that the bag carrying his rifle actually contained shower
rods.
"There were a lot of blameless people at Madoff Securities," he
said.
When Perez and O'Hara became suspicious in 2006 about how their
programs were used, Krantz said, they told DiPascali and Madoff they
were no longer "comfortable" writing programs that altered past
statements.
Krantz described that as a courageous move. Prosecutors, however,
have characterized it as an act of extortion, not bravery, in an
effort to get salary raises.
Krantz also pointed out that DiPascali admitted under
cross-examination that he had repeatedly lied to Perez and O'Hara
about the nature of their work to ensure they would help him
perpetuate the fraud.
"If they're in on the fraud, why on earth does Frank DiPascali have
to lie over and over to get them to do his dirty work?" Krantz said.
"It makes no sense."
DiPascali, Krantz added, has lied under oath before, when he
testified before the SEC regarding the firm's purported trading
strategies. He also changed his story several times between his
first meetings with government agents and his testimony at the
trial, Krantz said.
"This is not a typical human being," Krantz said. "This is a human
being who lost a grasp of truth and falsity a long time ago."
Closing arguments by defense lawyers are expected to last several
more days.
The case is USA v. O'Hara et al, U.S. District Court, Southern
District of New York, No. 10-cr-0228.
(Reporting by Joseph Ax; esditing by Tom
Brown)
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