MANHATTAN (CN) – The SEC accused two computer programmers of helping Bernard Madoff cover up his Ponzi scheme for more than 15 years. The agency claims that Jerome O’Hara and George Perez provided technical support to produce false documents and trading records, and took hush money to help keep the scheme going.
“Without the help of O’Hara [of Malverne, N.Y.] and Perez [of East Brunswick, N.J.], the Madoff fraud would not have been possible,” the SEC said in a statement today (Friday). “They used their special computer skills to create sophisticated, credible and entirely phony trading records that were critical to the success of Madoff’s scheme for so many years.”
The SEC claims the programmers knew they were writing programs to generate phony reports, and tagged many of the bogus programs with names that began with SPCL, short for “special.”
The programs spit out “many thousands of pages of fake trade blotters, stock records, Depository Trust Corporation (DTC) reports and other phantom books and records to substantiate nonexistent trading,” the SEC said in the statement it issued announcing its federal complaint.
It claims the two programmers “had a crisis of conscience” in 2006 and tried to cover their tracks by deleting 218 of the 225 special programs – but did not delete the monthly backup tapes. “O’Hara and Perez then cashed out hundreds of thousands of dollars each from their personal BMIS [Bernard Madoff Investment Securities] accounts before confronting Madoff and refusing to generate any more fabricated books and records,” the SEC said.
The SEC seek disgorgements and penalties.