Two Bernard Madoff Investment Securities
(BMIS) employees have been charged by the US Securities and
Exchange Commission (SEC) on a number of fraud related charges.
The SEC, who is investigating the $65bn Ponzi
scheme carried out by Bernard Madoff, filed its complaint in the US
District Court for the Southern District of New York against
long-term employees Annette Bongiorno and Joann Crupi.
Bongiorno, who started at the company in 1968,
is accused of regularly creating false books and records, helping
to mislead investors using account statements and trade
confirmations that reported false securities transactions and
positions that never existed.
Bongiorno also allegedly created false trades
in her own BMIS accounts that enabled her to cash out millions more
than she deposited.
“Bongiorno and Crupi helped create an
elaborate edifice of fake accounts, fake trades, and fake profits,”
SEC New York regional office director George Canellos said.
“Without their active and ongoing assistance, Madoff’s world of
lies would have been unsustainable.”
Crupi, who started at the firm in 1983, was
responsible for supervising the primary bank account used in BMIS’s
investment advisory operations and is said to have helped
facilitate the fraud by misleading investors, auditor, and
regulators into believing that BMIS was legitimate.
The SEC also alleged Crupi helped decide which
accounts should be cashed out before preparing cheques for those
selected investors, many of whom were friends or family of
The SEC has previously charged Madoff and
BMIS, his lieutenant Frank DiPascali, his key operative Daniel
Bonventre and auditors David Friehling and the firm Friehling &
SEC charges key Madoff operative