Five former employees of Bernard L. Madoff on trial for allegedly aiding his $17 billion Ponzi scheme were kept in the dark about the fraud and duped by his outsized personality and reputation, a jury was told.
The group's lawyers took turns giving opening statements in federal court in New York yesterday, saying their clients failed to recognize the carefully crafted fraud because they either idolized Mr. Madoff for decades or didn't have the skills.
Joann Crupi, who joined Mr. Madoff's firm straight out of college in 1983 and managed large accounts, never “pulled back the curtain on the Great Oz,” her lawyer Eric Breslin said. Mr. Madoff's employees viewed him as “almost a god” and Crupi, like everyone else, was duped into helping him, he said.
Ms. Crupi and her former colleagues seek to convince the jury they are just five more victims of Mr. Madoff and had no idea the investment company was a fraud until their boss's arrest on Dec. 11, 2008. Each defense lawyer said the government's witnesses are testifying against the group in a desperate bid to get reduced sentences and shouldn't be trusted.
Frank DiPascali, Mr. Madoff's finance chief, pleaded guilty in 2009 and agreed to assist in the criminal case, as have about half a dozen other former Mr. Madoff workers. He hasn't been sentenced yet.
Mr. Breslin compared Mr. DiPascali and the other witnesses to “drowning men and women” willing to push the people around them under water to stay afloat. “They're trying to save themselves by punishing other people,” he said.
The five former employees were lulled into a false sense of security by regulatory audits that never revealed problems, and the fact that financially savvy billionaires placed their money in Mr. Madoff's hands, their lawyers said.
U.S. District Judge Laura Taylor Swain said Thursday that the trial won't take place on Fridays and will resume on Monday. She has estimated the trial may last as long as five months, including a weeklong jury selection process that ended Oct. 15.