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Peter Madoff said at his plea that he had no idea his brother was running a massive Ponzi scheme, paying off longtime investors at times with money from newer investors.
"My family was torn apart as a result of my brother’s atrocious conduct," he said. "I was reviled by strangers as well as friends who assumed that I knew about the Ponzi scheme."
Peter Madoff, who joined his brother’s firm after graduating from Fordham Law School in 1970, has been free on $5 million bail after he agreed to surrender all assets.
Prior to sentencing, his lawyer, John Wing, said in a memorandum that Peter Madoff will "almost certainly live out his remaining days as a jobless pariah, in or out of prison." He called him a victim of his loyalty to his brother, saying he had been mistreated by the sibling who was eight years older and was viewed as "the prince" by his mother.
As part of a forfeiture agreement, Madoff’s wife, Marion, and daughter Shana must forfeit nearly all of their assets. The government said those assets and assets that will be forfeited by other family members include several homes, a Ferrari and more than $10 million in cash and securities. It said his wife will be left with $771,733. Besides the Madoff brothers, no other family members have been arrested.
Though Madoff had been the firm’s chief compliance officer for nearly four decades, the government marked his start in the conspiracy as 1996, when he created false and misleading compliance documents and false reports for the Securities and Exchange Commission.
Since the fraud was revealed, a court-appointed trustee has reached agreements to recover approximately $9.3 billion and is hoping to recover another $3 billion over the next 18 months. About $3 billion has been approved for redistribution to victims through an ongoing claims process.
Besides his brother, Peter Madoff is among six who have pleaded guilty in the case, including the former finance chief, a payroll manager, an accountant, a comptroller and a securities trader.
Five others face trial next year, including Bernard Madoff’s longtime secretary. All have pleaded not guilty.
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