Madoff Brother Eyed for Not Reporting Scam

Fraudster may have confessed to brother before he told his sons
By Rob Quinn,  Newser Staff
Posted Jan 10, 2009 6:39 AM CST

(Newser) – Bernard Madoff's brother learned that the Madoff fund was a huge scam the evening before the fraudster confessed to his sons, but he failed to inform authorities, insiders tell the New York Times. Peter Madoff, who worked closely with his older brother for decades, has not been charged with any crime, but experts say he was obligated to tell regulators as soon as he was informed, as the sons did. Also among Bernard Madoff's victims, the New York Post reports: his own sister.

Peter Madoff was senior managing director and the chief compliance officer for the firm. “If there is just a strict employee relationship, as chief compliance officer, there should be zero pause time before you report it,” says a white-collar criminal defense lawyer. "He may just have needed a night to sleep on it—it was his brother, after all," says a former prosecutor. A judge will decide Monday whether Bernard Madoff's bail should be revoked.