Bernard L. Madoff’s brother, Peter B. Madoff, was sentenced to 10 years in prison on Thursday for his role in enabling the extensive fraud that swindled investors out of billions of dollars.
Peter Madoff who served as the senior lawyer and chief compliance officer at Bernard L. Madoff Investment Securities, is the second figure in the scandal to be sentenced, coming about four years after his older brother confessed and received a 150-year prison term.
Peter Madoff, 67, was trained as a securities lawyer. In June, he admitted to a range of crimes, including falsifying documents, lying to securities regulators, and filing sham tax returns. Prosecutors said that if Peter Madoff had implemented a proper compliance program, regulators would likely have detected the fraud years earlier.
His guilty plea does not include an admission that he ever knew about or participated in the Ponzi scheme.
“Peter truly believed that his brother was a brilliant securities trader and as a result he encouraged his own family to invest millions of dollars in accounts managed by his brother,” wrote John R. Wing, a lawyer for Peter Madoff, in a letter to the court.
As part of a plea deal, Peter Madoff had agreed to a prison term of at least 10 years and a forfeiture of $ 143 billion. The penalty, which he could not possibly pay, is tied to the amount of the crime’s proceeds – and a clear signal that the government will seize all of his assets and distribute them to victims.
Madoff’s customers lost about $ 17.3 billion in the fraud, according to the Madoff bankruptcy trustee. About $ 9.3 billion has been recovered, and of that, roughly $ 3.7 billion has been distributed.