His name is Frank DiPascali. He was in charge of the smooth operation of Madoff’s Ponzi scheme on Floor 17, a top-secret operation needing a special pass to visit , and featuring an ancient IBM computer server, a bunch of clerks, and little else.
Fortune magazine has a lengthy article featuring DiPascali. The piece mostly recaps already-known facts about Madoff’s history and personal quirks. But there’s a bit of new information, based on reports that DiPascali is starting to do some talking in exchange for a possible plea bargain.
This is what he is alleged to be revealing:
According to a person familiar with the matter, DiPascali has no evidence that other Madoff family members were participants in the fraud. However, he is prepared to testify that he manipulated phony returns on behalf of some key Madoff investors…
It’s a long article, and I read it quickly. But it contains no indications that DiPascali has suggested that these investors-in-the-know actually knew about the Ponzi scheme aspect, or the scope of the fraud—just that they were involved in some fishy bookkeeping for their own benefit. But the part of the article that interested me most was the fact that so far, no evidence—including DePascali’s tale-telling—seems to backup the popular idea of the involvement and/or knowledge of family members.
It’s way too early to say, of course; there’s much more to learn. And whether we ever will know the truth, the whole truth, and nothing but the truth is doubtful. But I’ve been concluding for quite some time that there is a good chance that Madoff kept his fraud from family members. Whether there was enough evidence available to say that they should have known something was amiss is another story.
However, Madoff has hardly protected his family, even if he kept them in the dark about some things. And I’m not just talking about the money they themselves may have lost. Their reputations are ruined just as surely as his, whether a single bit of evidence ever emerges of their complicity or not. There are many kinds of prisons, and my guess is that they already have gotten a life sentence of sorts.