Federal authorities arrested a 77-year-old local man on charges related to the massive Bernard Madoff’s Ponzi scheme.
Paul Konigsberg, a long-time friend of Madoff’s, surrendered to authorities early Thursday morning after a warrant was issued for his arrest.
He pled not-guilty to charges of conspiracy, falsifying financial records and lying to the feds about employee benefits.
Authorities said Konigsberg, of 19 Pinecroft Road, was the only outsider that Madoff trusted to help him carry out his scheme.
“Madoff needed the assistance of certain willing outsiders that could be trusted to handle otherwise suspicious activity,” prosecutors said in their indictment of the accountant. “Paul Konigsberg, the defendant, was one of the people that Madoff could trust.”
It is alleged that Konigsberg, who worked as a senior partner at the now defunct accounting firm Konigsberg Wolf & Co., directed others to falsify records to conceal a fraud that cheated thousands of investors out of nearly $20 billion over decades.
According to the SEC, Konigsberg provided tax or accounting services for five of Madoff’s wealthiest and oldest clients who invested more than a billion dollars combines in BMIS. In addition to getting fees directly from BMIS clients, it is alleged that Konigsberg also received a monthly fee of $15,000 or $20,000 as a “retainer” from Madoff, who is currently serving 150 years in prison.
Konigsberg is freed on $2 million bail pending a court appearance on Monday.
According to his lawyer, Konigsberg, who had been friends with Madoff since the 1980′s, lost more than $10 million when Madoff’s empire collapsed in 2008.
