Bernard Madoff’s longtime aide Annette Bongiorno recruited investors from the neighborhood in Queens, New York, where she grew up next door to Madoff’s future finance chief, a former co-worker said

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Madoff Key Aide Bongiorno Recruited Her Neighbors as Investors


By David Voreacos and David Glovin


Feb. 14 (Bloomberg) -- Bernard Madoff’s longtime aide Annette Bongiorno recruited investors from the neighborhood in Queens, New York, where she grew up next door to Madoff’s future finance chief, a former co-worker said.

Bongiorno and her husband, Rudy, a retired electrician, recruited and stayed in touch with investors in the old neighborhood who held accounts called “RuAnn,” according to the employee, who requested anonymity. “RuAnn” is short for Rudy and Annette, the employee said. An account statement reviewed by Bloomberg News had the initials RU.

Bongiorno, 60, grew up in Howard Beach next to Frank DiPascali, a 33-year Madoff veteran who called himself chief financial officer. The families lived across from the Lindenwood Gardens co-ops, which bear the sign: “A Suburb in a City.”

“They were friends, like neighbors would be,” said Ann Casalotti, a resident of the red-brick, two-family house where Annette Bongiorno once lived next to DiPascali. Casalotti was one of thousands of Madoff customers whose name appeared on a list prepared for Irving Picard, the trustee liquidating the firm.

Madoff, 70, was arrested Dec. 11 and charged with securities fraud after allegedly confessing to running a $50 billion Ponzi scheme in which early investors were paid with money from later participants. Madoff, who is under house arrest in his New York apartment, hasn’t formally responded to the charge.

His lawyer, Ira Sorkin, declined to comment.

U.S. investigators are examining whether DiPascali, 52, played a role in the fraud, according to people familiar with the matter.

Early Employee

The ex-employee who described Bongiorno’s role in the 1980s joined Madoff when fewer than three dozen people worked at the firm, which was then based on Wall Street. Madoff and his wife attended the employee’s wedding and paid for airfare for the honeymoon.

Bongiorno, who worked as Madoff’s personal secretary in the 1980s, the former employee said, also had clerical duties at the firm. Clients who discovered that the wrong Social Security numbers on their statements were told to call Bongiorno, according to a copy of one such notice.

The Picard list, filed in U.S. Bankruptcy Court in New York, includes five Madoff investors who lived at the same addresses or within half a block of the former homes of Bongiorno and DiPascali. Bongiorno introduced DiPascali to the Madoff firm, according to the ex-employee.

In addition to Casalotti, Madoff investors include DiPascali’s brother-in-law Robert Cardile, a longtime Madoff worker. DiPascali and Cardile now live in Bridgewater, New Jersey. The list also includes the estate of John Argese; Bongiorno’s maiden name is Argese.

Former Investor

“I am” an investor, Casalotti said. “I mean, I was.”

Half a dozen other investors in Howard Beach live within a mile. One of them, an 84-year-old retired dressmaker, said she lost most of her life savings in a RuAnn account.

One Howard Beach investor who lost $9,000 and requested anonymity said he has relatives who lost money through RuAnn accounts. One was valued at more than $2 million, he said.

The investor said both DiPascali and Bongiorno told his family after Madoff’s arrest that they had nothing to do with any wrongdoing. DiPascali said his own mother lost money invested with Madoff, according to the investor.

DiPascali’s attorney Marc Mukasey declined to comment. Bongiorno, who hasn’t been charged in the case, didn’t immediately return calls to her homes in Manhasset, New York, and Boca Raton, Florida.

Clerical Assistants

Two assistants who did clerical work for Bongiorno at the Madoff firm have met with prosecutors recently, the Wall Street Journal reported today, citing people familiar with the matter.

One investor who knew the Madoff family for decades said Bongiorno was a “very important person” at the firm who often rode home to Manhasset at night in a company-supplied car. She was bright and “a right-hand person” to Madoff, the investor said.

Bongiorno and DiPascali worked together on the 17th floor of the firm’s Midtown Manhattan building, where their boss ran an investment-adviser business that was off-limits to most employees, said a person familiar with the matter. Agents of the Federal Bureau of Investigation have been working out of an office on the floor.

Bongiorno began recruiting small investors in the early 1980s, the employee said. While Madoff collected money from large investors, Bongiorno proposed that she gather money from smaller ones and feed it into Madoff’s fund, the employee said.

Tearful Call

The former employee said Annette Bongiorno telephoned after the collapse of Madoff’s firm, crying, to ask if the employee held Bongiorno responsible for the fraud.

The Bongiorno home in Manhasset, on Long Island, is valued at more than $2.6 million, according to property records. The Boca Raton home is assessed at $1.25 million, property records show.

The couple’s three cars include a 2007 Mercedes Benz E550 with a base price of $59,775 and a 2002 Mercedes Benz S55 AMG priced at $99,500, according to motor vehicle registration records.

Rudy Bongiorno worked as an electrician for the New York City Department of Transportation from 1975 to 1996, according to spokeswoman Nicole Garcia.

The case is U.S. v. Madoff, 08-mag-2735, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporters on this story: David Voreacos in Newark, New Jersey, at dvoreacos@bloomberg.net; David Glovin in New York federal court at dglovin@bloomberg.net.

Last Updated: February 14, 2009 00:01 EST