NEW YORK – Frank DiPascali, the finance chief for Bernard Madoff who turned on former colleagues to cooperate with the federal government, has died before he could be sentenced for his role in the biggest Ponzi scheme in U.S. history. He was 58.
He died May 7 of lung cancer, his lawyer Marc Mukasey said Sunday.
"He was grateful to have been able to make some amends by helping the government these past few years," Mukasey said.
DiPascali joined Madoff's firm as a teenager before going on to assist in the $17.5 billion fraud. He was the star government witness in its prosecution of five Madoff employees, who is serving a 150-year sentence in federal prison.
A jury found all five defendants guilty on all 30 counts, though the judge in their trial assailed testimony by DiPascali, saying it was largely unbelievable.
DiPascali, who called himself Madoff's "right-hand man," is a "glib storyteller and an admitted and convicted perjurer," U.S. District Judge Laura Taylor Swain said in Manhattan court last year.
DiPascali was the highest-ranking Madoff aide to testify at the trial, the only one ever conducted on the Ponzi scheme, which collapsed after Madoff's arrest on Dec. 11, 2008. The five former employees were convicted of aiding the fraud for decades and getting rich in the process. They were sentenced to between 2 ½ and 10 years in prison.
Madoff, 77, pleaded guilty in 2009. At least seven others also pleaded guilty, including his brother Peter Madoff, who is serving a 10-year term.
DiPascali, who faced as long as 125 years in prison, was seeking leniency by testifying against his former colleagues, all of whom claim they were duped by him and Madoff into believing his business was legitimate.
"In my nearly eight years as a federal prosecutor, I have dealt with dozens of cooperating witnesses. None of them compare to Frank DiPascali," Julian Moore, a former federal prosecutor who worked on the Madoff case, said in an e-mail. "He was strongly committed to providing truthful information that assisted the government in its criminal prosecutions and monetary recoveries."
DiPascali was born on Oct. 28, 1956, in the Howard Beach neighborhood of Queens, New York. With no formal training in finance, he joined Madoff's firm in 1975 at 19.
Questioned about when he learned Madoff was orchestrating a monumental fraud, DiPascali offered differing accounts.
He told prosecutors at one point that he knew about the fake trading "for as long as I could remember." Later, he testified he didn't know until 1992, the year Madoff and his inner circle devised a wide-ranging scheme to trick the Securities and Exchange Commission about the nature of the firm's trading.
DiPascali had said that, even after he discovered the trades were fake, he believed Madoff was investing client funds in other ways, including in real estate deals and French banks.