(Updates with Madoff trustee suit in sixth paragraph.)
Dec. 15 (Bloomberg) -- Bernard Madoff’s ex-controller, Enrica Cotellessa-Pitz, is expected to plead guilty to criminal charges stemming from her former boss’s Ponzi scheme, the U.S. said in a court filing.
Cotellessa-Pitz, who hasn’t been charged yet, will admit to falsifying documents to aid Madoff’s fraud and to deceiving U.S. regulators, as part of a cooperation agreement with the government, assistant U.S. attorneys Lisa Baroni and Julian Moore told a federal judge in a letter today.
Cotellessa-Pitz will plead guilty to four counts of conspiracy, falsifying books and records of a broker-dealer, falsifying books and records of an investment adviser and making false filings with the U.S. Securities and Exchange Commission, the prosecutors said. The charges carry as long as 50 years in prison, according to the letter to U.S District Judge Laura Taylor Swain.
Madoff, who pleaded guilty to fraud charges, is serving 150 years in prison for the largest Ponzi scheme in U.S. history. Investors lost about $20 billion in principal, the U.S. trustee liquidating Madoff’s securities business has said.
David Rody, a lawyer for Cotellessa-Pitz, didn’t immediately respond to voice-mail and e-mail messages seeking comment on the letter.
Irving Picard, the trustee liquidating Bernard L. Madoff Investment Securities LLC, sued Cotellessa-Pitz and her husband, Thomas Pitz, seeking the return of $3.7 million he claimed they received from the fraud.
Cotellessa-Pitz “played a key role in disguising the fraudulent Ponzi scheme from investors and investigators,” Picard said in the complaint. He said Cotellessa-Pitz was responsible for closing the company’s books each month, and for preparing annual financial statements and reports for filing with the Financial Industry Regulatory Authority and the SEC.
Cotellessa-Pitz was also supervisor of the firm’s anti- money laundering program, according to Picard.
The criminal case is U.S. v. O’Hara, No. 10-CR-228, U.S. District Court, Southern District of New York (Manhattan). The bankruptcy claim is Picard v. Cotellessa-Pitz, 10-4213, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
--Editors: Andrew Dunn, Fred Strasser
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