NEW YORK (AP) — An FBI agent told a jury Monday about the 2008 arrest of Bernard Madoff as the government began presenting evidence to try to prove that five of his former employees helped him carry out his multibillion-dollar fraud.
Agent Theodore Cacioppi said he was watching television at home on the evening of Dec. 10, 2008, when a supervisor contacted him saying Madoff "might be running the biggest Ponzi scheme in history."
He said he and three other agents went to Madoff's Manhattan apartment the next morning and interviewed him for an hour before arresting him. Madoff, 75, is serving a 150-year prison sentence after pleading guilty in 2009 to fraud charges.
Cacioppi was the author of the criminal complaint that was initially used to prosecute Madoff and to secure court orders to seize his businesses and assets. In the complaint, he had written that Madoff acknowledged he was "broke" and "insolvent" and that he had decided it "could not go on" and he expected to go to jail.
"After I stated, 'We're here to find out if there's an innocent explanation,' Madoff stated, 'There is no innocent explanation,'" the agent wrote.
Cacioppi was the first witness at a trial that is expected to last several months. In opening statements last week, defense lawyers said their clients could not have been expected to know what Madoff was up to when the former Nasdaq chairman managed to dupe federal regulators, sophisticated financial professionals and investors.
Cacioppi said he visited Madoff's midtown offices after arresting him, finding other agents already gathering evidence to show how Madoff managed to squander nearly $20 billion entrusted to him over more than four decades by thousands of investors, including close friends, charities, financial institutions and celebrities such as filmmaker Steven Spielberg and actor Kevin Bacon.
Several photographs introduced with Cacioppi on the witness stand captured what Madoff's offices looked like at the time of his arrest. A picture of the 17th floor offices of the private investment business where prosecutors say the fraud flourished included a snowman with a red scarf and gloves. A Santa Claus, candy canes and an empty stocking were on the walls.
Prosecutors used the trial's second witness, a 15-year Madoff employee who lost her job when the company closed in 2009, to introduce records that they say demonstrate how Madoff's workers lived large even as the company's days were numbered.
Financial records displayed for the jury demonstrated that one defendant, account manager JoAnn Crupi, spent thousands of dollars at a time on trips to Las Vegas and a wine store.
A lawsuit filed by the Securities and Exchange Commission has said that from 2004 through 2008 Crupi accumulated $270,000 in expenses on the firm's credit card for which she never reimbursed the company.
The government said she also wired $2.25 million from the firm's main account to an outside account in late 2008 so she could purchase a beach house in New Jersey.
Others on trial are Madoff's longtime secretary, Annette Bongiorno, former director-of-operations Daniel Bonventre, and computer programmers Jerome O'Hara and George Perez. All have pleaded not guilty.
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