| NEW YORK
NEW YORK Feb 19 Only minutes into the
prosecution's questioning of former Bernard Madoff aide Daniel
Bonventre at trial on Wednesday, it was clear he was in for a
Assistant U.S. Attorney Randall Jackson asked Bonventre
repeatedly whether he was "close friends" with one of four
co-defendants accused of helping to conceal Madoff's
decades-long, multibillion-dollar fraud, former portfolio
manager Annette Bongiorno. Bonventre repeatedly said he did not
know what Jackson meant.
"You went to college, correct?" Jackson asked with a note of
frustration in his voice. "Do you have any difficulty with the
definition of the word 'close'?"
A flustered Bonventre eventually said, "Yes, I struggle with
the meaning of 'close.'" Bonventre did, however, acknowledge
that he and Bongiorno were friendly colleagues.
Bonventre, 67, who worked at Madoff's firm for 40 years,
is the first of five former employees on trial in federal court
in Manhattan to take the unusual step of testifying. The trial
began in October, nearly five years after the December 2008
arrest of Madoff, now 75 and in prison.
The other defendants charged with helping Madoff conceal his
fraud by using false documents and fake trades, Bongiorno,
portfolio manager Joann Crupi and computer programmers Jerome
O'Hara and George Perez, have not made a final decision on
whether they will take the stand.
All five have argued they were unaware of Madoff's fraud,
which cost investors an estimated $17 billion in principal
losses. Under questioning from his lawyer, Bonventre said he
only learned of the scheme when Madoff was arrested.
Madoff pleaded guilty in March 2009 and he is serving a
150-year prison sentence.
Wednesday's testimony drew a crowd of onlookers, including
high-ranking members of the U.S. Attorney's office, as Jackson
challenged Bonventre on everything from his corporate title to
his tax returns.
Putting his hands on his hips and widening his eyes in
disbelief, Jackson's body language seemed aimed at convincing
the jury that Bonventre, who directed the firm's broker-dealer
unit, simply could not be believed.
Earlier in the trial, two former Madoff aides who are
cooperating with prosecutors testified that Bonventre helped
create forged versions of statements showing the firm's
securities holdings at an outside clearinghouse.
On Wednesday, Bonventre said he became aware of a project to
print statements but did not work on it. He said Madoff
explained to him that he wanted to print his own versions rather
than purchase paper statements from the clearinghouse to save
money. That did not make sense, Bonventre said, because by that
time the firm largely received the information electronically.
"This raised no red flags for you?" Jackson asked.
Bonventre replied that he told Madoff the project was
unnecessary, but he said he did not think it was suspicious.
Prosecutors charge that the fake statements were used to fool
regulators into believing the firm's investment advisory unit
Bonventre's lawyer, Andrew Frisch, pointed out during
questioning of his client that Bonventre's son, two stepsons,
cousin and nephew all worked at Madoff's firm at different
Frisch asked Bonventre whether he would have helped get them
those jobs had he known of the fraud.
When Bonventre said no, Frisch asked, "Any doubt about
"None whatsoever," Bonventre said.
The testimony is scheduled to resume on Thursday.
The case is USA v. O'Hara et al, U.S. District Court,
Southern District of New York, No. 10-cr-0228.