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Madoff Lieutenant Expected to Blow Lid Off Scam

By Rob Quinn, Newser Staff

Posted Aug 12, 2009 6:17 AM CDT

(Newser) – Investigators see yesterday's guilty plea of Bernard Madoff's right-hand man as a major breakthrough in their efforts to untangle the elaborate Ponzi scheme, BusinessWeek reports. Frank DiPascali, chief financial officer at Madoff's firm, has promised to cooperate with prosecutors and is expected to name other people involved in the scam and to help trace assets Madoff may have stashed around the world.

DiPascali—who faces a maximum 125-year sentence and has been jailed without bail—played a key role in the scheme, helping Madoff prepare all the paperwork to fool investors and make fake trades look real. DiPascali's agreement to work with prosecutors is expected to spur others to own up to their role in the scam. "This isn't the Mafia," the head of one investigation firm says. "No one's going down with the ship."

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Bernard Madoff's accountant David Friehling has pleaded not guilty to securities fraud, although analysts believe he may start talking now that Madoff's chief financial officer has confessed. (AP Photo/ Louis Lanzano)

Victims of disgraced financier Bernard Madoff and their supporters gather near the courthouse complex after Madoff was sentenced to 150 years in prison for his massive fraud scheme. (AP Photo/Peter Morgan)

Bernard Madoff exits Manhattan federal court in New York earlier this year. (AP Photo/ Louis Lanzano, file)

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This guy knows where the bodies are buried. - Robert Lamb, a professor at New York University's Stern School of Business

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COMMENTS

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Showing 2 of 2 comments

hwoodude

Aug 18, 2009 3:26 AM CDT

Instead of jailing all these thieves, liars, and con men why not place them in sem-confinement but put them in jobs..where they work for free, i,e, 911 phone people, hospital workers, washing police cars, etc. ?

Spudsy

Aug 12, 2009 5:39 AM CDT

It would be interesting to see what he has hidden around the world. Not to be vindictive but it would be nice to see his kids and wife get sent to the poorhouse. I would gladly commit some heinous crime in my twilight years if I thought it would set my family up for a comfortable physical life. Society needs to make sure that such actions are punished, not rewarded .

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BusinessWeek (Source Grid »)

Money • Crime & Courts

Ponzi scheme • securities fraud • witness • defrauding investors • Bernard Madoff • Bernard L. Madoff Investment Securities • Frank DiPascali

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