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Madoff Accountant Admits To Role In Infamous Ponzi Scheme

Bernard L. Madoff leaves US Federal Court after a hearing regarding his bail on January 14, 2009 in New York. (credit: TIMOTHY A. CLARY/AFP/Getty Images)

Bernard L. Madoff leaves US Federal Court after a hearing regarding his bail on January 14, 2009 in New York. (credit: TIMOTHY A. CLARY/AFP/Getty Images)

NEW YORK (CBSNewYork/AP) — A senior partner at a New York accounting firm has now pleaded guilty to his role in the multi-billion dollar Bernard Madoff Ponzi scheme.

As WCBS 880’s Irene Cornell reported, account executive <a title="Madoff Accountant Charged With Involvement In Massive Fraud" Paul Konigsberg, 78, was the only person outside the Madoff family to have held an ownership interest in Madoff’s private investment business.

Madoff Accountant Admits To Role In Infamous Ponzi Scheme

madoff1 Madoff Accountant Admits To Role In Infamous Ponzi Scheme
Irene Cornell reports

In his guilty plea, under a cooperation agreement with the federal government, Konigsberg admitted to becoming an unwitting participant in Madoff’s massive fraud.

Konigsberg’s firm – Konigsberg Wolf & Co. – had handled some 300 accounts belonging to Madoff’s favorite clients. Konigsberg admitted to having trades backdated on those accounts in order to maximize profit.

He told U.S. District Judge Laura Swain he knew that returning statements to Madoff to be changed was wrong, but claimed he was not aware of Madoff’s infamous Ponzi scheme.

Konigsberg was charged in an indictment last year with conspiracy to falsify records, conspiracy to commit fraud, falsifying records of a broker-dealer, falsifying record of an investment adviser and falsifying statements.

The indictment said Madoff, who is serving a 150-year prison sentence after admitting the fraud in 2009, steered some of his most important customers “in whose accounts Madoff executed the most glaringly fraudulent transactions” to use Konigsberg as their accountant.

By the time Madoff was arrested in December 2008, Konigsberg Wolf handled accounting duties for more than 300 of Madoff’s private securities accounts, court papers said.

The indictment said certain outsiders helped Madoff keep the fraud secret. It said that thousands of investors were cheated out of nearly $20 billion and that the outsiders were trusted to handle otherwise suspicious activity.

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