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Ex-Madoff accountant expected to plead guilty

By Joseph Ax

NEW YORK (Reuters) - Bernard Madoff's former accountant is expected to plead guilty to charges in connection with the convicted swindler's massive Ponzi scheme, a U.S. prosecutor said at a Tuesday court hearing.

Paul Konigsberg, a former senior tax partner at Konigsberg Wolf & Co, will likely enter a guilty plea next week under a cooperation agreement with the government, Assistant U.S. Attorney Matthew Schwartz said.

"We are finalizing the terms of a plea," Schwartz told U.S. District Judge Laura Taylor Swain in Manhattan.

Konigsberg and his attorney, Reed Brodsky, attended the hearing but did not discuss plea details.

The nature of Konigsberg's proposed cooperation is unclear. No criminal charges are pending against other defendants in the Madoff case, though several have yet to be sentenced.

Brodsky declined to comment after the hearing.

Konigsberg would be the 15th defendant to plead guilty or be convicted at trial in connection with Madoff's fraud, estimated to have cost customers more than $17 billion in principal.

In March, five former Madoff aides were convicted of all counts in Swain's courtroom after one of the longest white-collar trials in federal court in Manhattan.

The trial featured the testimony of former Madoff employees, including his top lieutenant, Frank DiPascali, who pleaded guilty and agreed to help the prosecution.

Konigsberg, who is in his 70s, was charged in September with two counts of conspiracy and three counts of falsifying records and statements.

Prosecutors accused him of manipulating trades, including by backdating transactions, to make it appear that Madoff's customers were receiving their promised investment returns.

He was also charged with helping Madoff conceal the fraud by arranging for customers to receive "amended" account statements that included fake trading records.

Konigsberg faces a parallel civil lawsuit from the U.S. Securities and Exchange Commission.

Madoff, 76, was arrested on Dec. 12, 2008, pleaded guilty three months later, and is serving a 150-year prison term.

Others who pleaded guilty included Madoff's brother, Peter, and a former accountant, David Friehling.

The five convicted aides are portfolio managers Annette Bongiorno and Joann Crupi, computer programmers Jerome O'Hara and George Perez, and back-office director Daniel Bonventre. All are seeking to have their convictions thrown out.

(Editing by Jonathan Oatis)

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