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Bernie Madoff robbed a dead guy, and nine other astounding allegations made by former employees

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Just three months after being arrested, in March of 2009, Bernie Madoff pleaded guilty to all 11 federal charges, cementing his future behind bars. While the quick conclusion was a clear win for prosecutors, the lack of a trial left a fairly disjointed narrative. How exactly did he pull it off? When did the fraud begin? Who else, if anyone, was involved?

Nearly five years to the day of Madoff’s arrest, some of the pieces are coming together via the trial of five of his former employees who, unlike Madoff, have pleaded not guilty. While the cases are ongoing, a host of eye-opening allegations have already been made. Here are a few of the headliners.

40-year fraud: Star prosecution witness and ex-Madoff finance chief Frank DiPascali, who, we must note, has already pleaded guilty and is testifying against his former colleagues with the hope of leniency, answered two of the key questions surrounding the Madoff conspiracy. DiPascali, 57, said the Ponzi scheme had been going on for “as long as [he] could remember.” DiPascali began working as a researcher for Madoff when he was just 19, so that’s a long time.

They had to have known: As for who knew about the fraud, one of the key questions in the case, DiPascali said it was “virtually impossible” not to know of the fake trading. Unlike real trading, which takes coordination, phone calls and counterparties, Madoff’s investment advisory unit remained quiet and motionless, according to DiPascali. Rather, Madoff’s longtime secretary Annette Bongiorno would be given a small stack of index cards roughly once a month that contained historical stock prices taken from newspapers, according DiPascali. She never even looked at real-time prices, he said.

Dead is bad for business: As DiPascali tells it, Madoff himself was the one who decided how much each client “earned.” But, to remain believable, there need to be peaks and valleys. So in 1995, when a 20-year client died during a peak, Madoff decided the man had too much money in his account. According to DiPascali, Madoff then instructed two employees to create a new fake account from scratch and pile on fake losses to counter the fake gains. The firm saved around $1.5 million.

Cold Off the Presses: Prosecutors allege one story where a few Madoff protégés were in the middle of an audit and needed to quickly cook up a fake document. Rather than handing it right off the printer, they put the document in the refrigerator to cool it off.

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North Pole: In a rather strange back-and-forth, one witness referred to the step-son of operations manager Daniel Bonventre, who also worked at the firm, as a lazy real-life George Costanza from TV’s Seinfeld, only he had a cocaine problem. In a previous trial, Madoff Securities was known as the “North Pole” due to the amount of cocaine that was reportedly consumed there, according to the New York Daily News.

Chubby Cheeks: Exactly how vain was Madoff? In 1992, when the Wall Street Journal ran a story tying Madoff Securities to Avellino & Bienes, an accounting firm that was eventually shut down for fraud, Madoff had one chief concern: the way his ink-dot portrait looked in the paper. “His biggest concern was that the caricature didn’t look like him. ‘It makes my cheeks look too big,’ he said, according to DiPascali.

The friend’s price: Not all clients were treated equally. Beverly Hills money manager Stanley Chais, who helped funnel millions of dollars of other people’s money to Madoff, never lost. Not once. Madoff picked his returns personally.

Winning the lottery twice: Former employee Barry Fleischmann won a $17m lottery jackpot in 2007, a year before the firm went belly up. He asked Madoff if he could invest part of it in the fund, but Madoff demanded the entire sum, according to court testimony. Fleischmann decided against investing, a move that had other employees noting that “he won the lottery twice.”

He was generous, kind of: Bernie Madoff had no policies in place for corporate credit cards, allowing employees to use them to finance trips to Disney World and purchase thousands of dollars of wine. Expenses were reportedly never turned down. And when a former employee needed a home loan but didn’t have the collateral, Madoff reportedly told him to see office aide Joann Crupi and “tell her what you need.” She allegedly cooked up a fake statement that said he had more than $6 million in one of his Madoff Securities account, even though it was in the red.

Hush money: But not all was quiet on the home front. Prosecutors have alleged that two of the defendants in the trial – computer programmers Jerome O’Hara and George Perez –demanded and received hush money after finding out about the fraud, but did nothing to stop it.

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