Accountant charged with falsifying records in connection with Madoff scheme

Paul Konigsberg, an attorney and accountant, was charged Thursday with multiple counts of falsifying records and related securities charges in connection with Bernie Madoff's Ponzi investment fund scheme.

Konigsberg was the only non-Madoff family member to hold an ownership stake in the investment fund he ran.

A 19-page indictment, returned by the U.S. Attorney's Office for the Southern District of New York, alleges that "Madoff directed many of his clients - including some of his most important customers, in whose accounts Madoff executed the most glaringly fraudulent transactions -- to use Paul Koningsberg, the defendant, as their accountant."

The indictment says that Konigsberg would back date "trades" and statements, as well as falsify documents and statements.

It has been nearly five years since Madoff was arrested by the FBI for directing a Ponzi scheme believed to have cost investors billions of dollars. He later pleaded guilty and is serving a 150-year prison term.

Following the unsealing of the indictment and Konigsberg's appearance in federal court, U.S. Attorney Preet Bharara said in a statement, “As alleged, Paul Konigsberg threw aside his ethical duties as an accountant in favor of his role as a false bookkeeper, which included allegedly participating in a scheme of back-dating client account statements to show fictitious trades and conjuring profits and losses of millions of dollars. With today’s indictment, he will be made to answer for his alleged conduct as yet another player on Madoff’s team.”

In addition to the falsification of records, the indictment also says that an unnamed relative of Konigsberg received a "no-show" job. The press release said that "beginning in approximately 1992, Madoff offered KONISBERG, the defendant, an additional cash payment of approximately $20,000 per year. Rather than receiving this money in the form of trading profits, KONIGSBERG instructed Madoff to pay a relative of Konigsberg's (“CC-2”), who had previously worked at Madoff Securities."

Konigsberg's attorney, Reed Brodsky, told NBC News that "our client is a 77-year old-outside accountant, not an employee of the Madoff firm, and he was not an accountantof Bernie Madoff himself." Brodsky said that his client himself lost millions of dollars in Madoff's scheme, and added that in the indictment there is "very little evidence that Mr. Konigsberg did anything wrong."

In a statement released earlier Thursday, Brodsky said that Konigsberg "looks forward to clearing his good name at trial. In their witch hunt arising out of the largest Ponzi scheme in history, the government conveniently ignores that the sociopath Bernie Madoff deceived everyone around him -- from the most sophisticated investors to the SEC itself."

Follow NBC News' Tom Winters on Twitter: @Tom_Winter

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