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Programmers Indicted In Madoff Securities Scandal

Developers allegedly designed programs that falsified investment and trading information
A U.S. grand jury formalized criminal charges last week against two former computer programmers at swindler Bernard Madoff's firm, alleging they conspired with others to falsify investor records using a special program.

According to a Reuters report, the two men, Jerome O'Hara and George Perez, were originally charged last Nov. 13 for their purported role in the multibillion dollar, decades-long fraud against thousands of investors at Bernard L. Madoff Investment Securities LLC.

O'Hara's lawyer, Gordon Mehler, told Reuters that his client "intends to plead not guilty, and even though it's been more than four months [since his arrest], he is still presumed innocent."

If convicted, the two could each face maximum possible prison sentences of 30 years and millions of dollars in fines. Madoff, 71, is serving a 150-year term after pleading guilty a year ago of masterminding the huge fraud.

O'Hara and Perez "were indicted today by a federal grand jury in Manhattan on charges of conspiracy, falsifying records of a broker-dealer, and falsifying records of an investment adviser," a statement by Manhattan U.S. Attorney Preet Bharara said.

O'Hara and Perez, employed at the firm from 1990 and 1991, respectively, were primarily responsible for developing and maintaining computer programs in the investment advisory unit at the center of the fraud, according to the Reuters report.

Many of the programs were run on an IBM server known as "House 17," according to court documents. Prosecutors said the men took hush money to help keep the fraud going and designed codes to make up fake trade blotters and phantom records.

U.S. prosecutors said the two men worked under the supervision of Madoff and his top aide, Frank DiPascali, to deceive the U.S. Securities and Exchange Commission and a European accounting firm. DiPascali is cooperating with prosecutors, who said his information led to the arrests of the programmers and the now-defunct firm's outside accountant.

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