Spring Break
Madoff behind bars, but probe grinds forward
LARRY NEUMEISTER and TOM HAYS - The Associated Press
Issue date: 7/1/09 Section: News
Besides the family, there have been questions about the role of Frank DiPascali, chief financial officer of Madoff's money management business, and that of several large money managers who funneled billions of dollars of investments to the firm. The trustee, Irving Picard, has filed lawsuits against the managers, accusing them of being Madoff cronies who either knew, or should have known, about the fraud.
Former prosecutors said Madoff's sentencing wasn't a grand finale.
"Once the primary wrongdoer has been sentenced, it typically is a fact that will take the wind out of the sails of an investigation," said William Devaney, a former federal prosecutor now in private practice. "However, this is an atypical investigation."
Another former federal prosecutor, Christopher J. Steskal, said that heedlessly benefiting from the fraud wasn't enough to bring a criminal case against a potential suspect. Investigators need convincing proof that the person had criminal intent and participated in the scheme. It's likely authorities are cultivating cooperators to provide that proof, he said.
"If you're under investigation, you have two options: You either dig a foxhole and hide in it, or you conclude that you have no option except to try to earn points by cooperating," said Steskal, who's now in private practice in New York.
The list of possible cooperators include DiPascali, who reportedly has given investigators evidence against the so-called feeder fund managers. Also, an accountant charged as the only other defendant so far has signaled in court papers that he wants to negotiate a plea deal. Their attorneys have declined to comment.
Federal authorities also have spoken to several clerks who handled some of the voluminous paperwork Madoff admits he fabricated, including tens of thousands of fake account statements.
One of Madoff's burned clients, Phyllis Feiner of Great Neck, N.Y., said Tuesday that she looks forward to more arrests.
"I would like to see everybody else who was involved in this evil scheme to be brought to justice," she said. "There's absolutely no way he could have done this all by himself."
Former prosecutors said Madoff's sentencing wasn't a grand finale.
"Once the primary wrongdoer has been sentenced, it typically is a fact that will take the wind out of the sails of an investigation," said William Devaney, a former federal prosecutor now in private practice. "However, this is an atypical investigation."
Another former federal prosecutor, Christopher J. Steskal, said that heedlessly benefiting from the fraud wasn't enough to bring a criminal case against a potential suspect. Investigators need convincing proof that the person had criminal intent and participated in the scheme. It's likely authorities are cultivating cooperators to provide that proof, he said.
"If you're under investigation, you have two options: You either dig a foxhole and hide in it, or you conclude that you have no option except to try to earn points by cooperating," said Steskal, who's now in private practice in New York.
The list of possible cooperators include DiPascali, who reportedly has given investigators evidence against the so-called feeder fund managers. Also, an accountant charged as the only other defendant so far has signaled in court papers that he wants to negotiate a plea deal. Their attorneys have declined to comment.
Federal authorities also have spoken to several clerks who handled some of the voluminous paperwork Madoff admits he fabricated, including tens of thousands of fake account statements.
One of Madoff's burned clients, Phyllis Feiner of Great Neck, N.Y., said Tuesday that she looks forward to more arrests.
"I would like to see everybody else who was involved in this evil scheme to be brought to justice," she said. "There's absolutely no way he could have done this all by himself."
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