NEW YORK, N.Y. – A second-generation employee of Bernard Madoff who was one of the earliest government co-operators after the massive Ponzi scheme was revealed was sentenced Wednesday to nine months of home detention.
Eric Lipkin, who said he “cannot apologize enough” for his crimes and its impact on thousands of investors, was sentenced in Manhattan by U.S. District Judge Laura Taylor Swain. She said Lipkin had made significant amends through years of co-operation to earn a substantial reduction from what could have been a life sentence.
“He has been humbled by what has happened,” she said, noting that he will be permitted to leave his home for work, to care for his children and to continue co-operating while he serves nine months with an electronic bracelet to help enforce a curfew. “His crimes have shattered dreams and changed lives forever.”
Lipkin, whose 76-year-old father was one of Madoff’s first employees, pleaded guilty in June 2011 to falsifying financial records and other crimes during his 16 years with Madoff’s secretive investment advisory business. He had admitted doctoring documents to fool auditors, faking payroll records and obtaining a loan by inflating the value of his personal accounts. But he maintained that he never knew about the Ponzi scheme.
His lawyer, James Filan, said his client was first taken to Madoff’s business when he was 5 years old and was doing clerical work for his father when he was 15 or 16. Filan said his client now stocks shelves in a sporting goods store, a modest job that helps support his wife and three children.
Lipkin, 41, of Ridgewood, New Jersey, was also ordered to forfeit $1.4 million. A court-appointed trustee recovering money for Madoff investors had labeled Lipkin part of Madoff’s “inner circle.” In court papers, the trustee said he profited handsomely from a fraud that cheated investors out of about $20 billion.
Assistant U.S. Attorney Randall Jackson told the judge that Lipkin was one of the earliest government co-operators after Madoff’s fraud collapsed in December 2008.
He said the co-operation was significant because Lipkin was able to verify information later provided by his boss, Frank DiPascali, Madoff’s former right-hand man.
DiPascali died two weeks ago of lung cancer before his sentencing. His testimony played a role in the conviction last year of five former Madoff employees, including his director of operations and personal secretary.
Lipkin followed his father into the company in 1992. Madoff, 77, is serving a 150-year prison sentence at a North Carolina federal lockup after pleading guilty to fraud charges in 2009.