First accomplice named
David Friehling's office
Bernard Madoff’s accountant, David Friehling, has been arrested in relation to the Ponzi scheme that bilked billions out of clients and landed Madoff in jail.
Friehling, sole proprietor of the Friehling & Horowitz, is being charged with securities fraud. He turned himself in to authorities today.
Unwitting participant
Authorities do not accuse Friehling of knowing about the scheme. Rather, they say he certified Madoff’s firm’s financial statements without completing an audit. Accusers say this deceived investors and allowed the scheme to continue undetected because he “rubber stamped” Madoff’s falsified numbers.
A lengthy tenure
Friehling has served as Madoff’s auditor since 1991. Over the past few months a Ponzi scheme that swindled $65 billion out of money manager Madoff’s clients surfaced. Madoff has been convicted on 11 charges, including fraud.
Hefty charges
It’s unknown what kind of bail Friehling is facing, but if it’s anything like the $10 million Madoff is being held on until his sentencing trial, Friehling might have to pay it off in installment loans.
Friehling’s charges include securities fraud, aiding and abetting investment adviser fraud and four counts of filing false audit reports to the Securities and Exchange Commission, according to the U.S. Attorney for the Southern District and the Federal Bureau of Investigation.
Not getting off easy
Madoff, 70, essentially is facing life in jail for his crimes. His sentencing is scheduled for June, and he could get up to 150 years in prison.
If convicted, Friehling could face a similar fate. His charges could earn him up to 105 years in jail. Friehling, 49, would stay in prison for the rest of his life if he is found guilty and given the maximum sentence.
More on Madoff
Madoff
Madoff is locked up in the Metropolitan Correctional center in Manhattan. He is scheduled to remain there until his sentencing, June 16. But he’s not waiting quietly. He has a hearing tomorrow to appeal his $10 million bail. He says he should be released until his sentencing.
Wow… the list just goes on and on. There’s no way Mr. Friehling did not see this coming. Being Madoff’s accountant for 17 years, there’s no doubting he would have at least figured there was something fishy going on. Remember, everything hidden in the dark will be brought to the light eventually.
I don’t know if this guy really needs a life sentence. Madoff, certainly, but in this case I think it’s more likely that as an accountant (let us assume for a moment he’s just a CPA rather than a JD/MBA like a lot of high profile accountants are) he was given the forms of a very wealthy and powerful man who he made a lot of money from his business over the last few decades, and he thought it best just not to ask questions. Which really isn’t much of a defense, and he does deserve jail time and stripping of his license, but his crime was nowhere NEAR the size of Madoffs. And that is IF he didn’t know anything. If he was complicit, they d lock the door and toss the key.
Life sentence? 150-years? Apparently it is more a crime to steal people’s money than violent crimes.