Bernard Madoff’s younger brother Peter pleaded guilty in federal court in Manhattan, the first of the swindler’s kin to face charges in history’s largest Ponzi scheme.
Peter Madoff, who for years worked as the chief compliance officer and senior managing director for Bernard L. Madoff Investment Securities, agreed to a deal with prosecutors that calls for a prison term of 10 years, according to court papers.
While little is known publicly about the federal government’s case against Peter Madoff, prosecutors indicated in court papers that it involves misleading investors about the Madoff firm’s compliance program and falsifying securities records.
Peter Madoff had faced a count of conspiracy and falsifying records of an investment advisor, according to the court papers. In addition to a decade behind bars, he would forfeit $143 billion, including all of his real estate and personal property.
Peter Madoff’s primary role was with Madoff’s broker-dealer business, which was separate from the fraudulent money management operation that generated $65 billion in paper losses.
Bernard Madoff, now 74, confessed his fraud in December 2008 as the financial crisis and global sell-off in equities led his investors to pull out their money. The Ponzi scheme collapsed, and Madoff surrendered to the FBI.
He is serving a 150-year sentence at a federal prison in North Carolina.
At his sentencing in June 2009, Bernard Madoff suggested that his brother, along with his other loved ones, was unaware of the scheme.
“How do you excuse lying to your brother and two sons, who spent their whole adult life helping to build a successful and respectful business?” Bernard Madoff asked the judge.
“How do you excuse lying and deceiving a wife who stood by you for 50 years, and still stands by you?” he went on. “And how do you excuse deceiving an industry that you spent a better part of your life trying to improve? There is no excuse for that, and I don’t ask any forgiveness.”