Another Madoff Player Charged in Ponzi Scheme

March 1st, 2010
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Last week the SEC charged Daniel Bonventre, Bernard Madoff’s Director of Operations, with disguising the infamous fraud at Madoff’s firm, Bernard L. Madoff Investment Securities. According to the SEC’s press release, Mr. Bonventre, who ran Madoff’s accounting for at least thirty years, covered up the Ponzi scheme by “misusing and improperly recording investor money to create the false appearance of legitimate income.” In addition to enabling the fraud, Mr. Bonventre also earned an illicit $1.9 billion in income by backdating trades for his personal gain, the SEC alleges.

The SEC states that “Bonventre was responsible for the firm’s general ledger and financial statements that were materially misstated because they did not reflect the manner in which investor funds were maintained and used.” The SEC’s investigation found that Mr. Bonventre was aware investors’ money had been diverted away from purchasing securities and that over $750 million had been used to falsify and misrepresent the firm’s revenue and income reports. The SEC further claims that “Bonventure ensured that BMIS financial reports did not reflect the firm’s massive liabilities to investors or the corresponding assets received from investors.”

George S. Canellos, the SEC’s New York Regional Office Director, stated, “A fraud of this magnitude requires a coordinated effort. Bonventre played an essential part by creating bogus financial records to give BMIS the appearance of legitimacy, when in fact the firm lost money and could not have survived without the fraud.”

The SEC has previously charged Madoff and BMIS, Frank DiPascali, Jr., auditors David G. Friehling and Friehling & Horowitz CPAs, P.C., several feeder funds, and two computer programmers with ties to the multi-billion dollar Ponzi scheme and its coverup.
For Detailed Investor Profiles on these Investors, click below:
Madoff Investments LLC
Related People: Bernard Madoff
Related Article Tags: Hedge Fund Fraud and Ponzi Scheme News


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