DAVID FRIEHLING, the long-time accountant of Bernard Madoff, will plead guilty to fraud charges next week, prosecutors have revealed, widening the net of conspirators in the biggest Ponzi scheme in history.
Mr Friehling will plead guilty to seven counts of fraud next Tuesday, prosecutors said in a letter to Judge Alvin Hellerstein, of New York’s southern district court, on Thursday. Charged with securities fraud, investment adviser fraud, obstructing internal revenue laws and making fake filings with the US Securities and Exchange Commission, he could face more than 100 years in jail.
Mr Friehling is one of two people charged in Madoff’s fraudulent investment scheme, which the trustee in charge of covering losses estimated cost investors $21.2 billion (€14.3 billion).
In August, Frank DiPascali, another senior lieutenant to Madoff, pleaded guilty to 10 criminal charges. DiPascali faces life in prison. The decision by Mr Friehling comes after he initially pleaded not guilty to fraud charges last July. At that time he waived his right to a criminal indictment, signalling that a deal with prosecutors in exchange for a more lenient sentence was possible.
Prosecutors said previously they would seek forfeiture of Mr Friehling’s proceeds from the alleged securities fraud. He has not been accused of knowing about Madoff’s fraud.
Andrew Lankler, Mr Friehling’s lawyer, had no comment.
“He was duped by Madoff . . . but he had the obligation not to be duped,” said Peter Henning, professor at Wayne State University Law School.
Bernard Madoff is now serving a 150-year sentence. – (Copyright The Financial Times Limited 2009)
