Publications
Partners
New York - A former outside auditor and a former human resources employee of Bernard Madoff's firm have avoided prison by co-operating with authorities investigating the now-imprisoned swindler's multibillion-dollar Ponzi scheme.
The auditor, David Friehling, was sentenced by US District Judge Laura Taylor Swain in New York to a year of home confinement, and to pay his share of a symbolic $130bn joint forfeiture with other defendants.
"I will regret for the rest of my life the role I played in this devastating crime," Friehling, 55, said in court.
Fraud cost investors
Swain also sentenced the former human resources employee Craig Kugel, 41, to time served, and ordered that he forfeit $2.3m.
Both men were among the 15 people to be convicted at trial or to plead guilty in connection with the investigation of Bernard L. Madoff Investment Securities LLC following the collapse of Madoff's Ponzi scheme in 2008.
Madoff is serving a 150-year prison term for orchestrating a fraud that cost investors an estimated $17bn in principal losses.
Friehling and Kugel testified at the trial of five other former Madoff employees, all of whom were convicted in 2014 and sentenced to prison terms ranging from 2-1/2 to 10 years.
Prosecutors said Friehling, who pleaded guilty in 2009 to charges including securities fraud, never conducted a meaningful review of the firm's finances but instead rubber-stamped information presented to him by Madoff employees.
Fraudulent tax returns
Friehling also certified to the US Securities and Exchange Commission that he used standard accounting practices to audit the firm, prosecutors said.
Though Friehling's actions helped Madoff conceal his fraud, Friehling said he did not know of the Ponzi scheme.
Friehling also served as Madoff's personal accountant and prepared fraudulent tax returns for Madoff, his brother Peter, and his sons Mark and Andrew, prosecutors said.
Kugel pleaded guilty in 2009 to tax fraud and making false statements.
