Even before he admitted his Ponzi scheme to his family, Bernard Madoff had begun a plan to destroy the most damning evidence with a massive shredding operation, according to former FBI case agent Keith Kelly, speaking publicly for the first time in an interview with ABC News.
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Madoff ordered 50 boxes of documents taken from his Manhattan offices to a warehouse in Queens where they were shredded.
“What was in those 50 boxes, we never found out,” Kelly said. “Why he didn’t shred more, quite honestly, I don’t know.”
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Kelly said the case was so document-intensive, had he shredded more, “the case against him would’ve been very, very difficult,” resulting in much less serious criminal charges.
“He would have gone to jail for something,” said Kelly, “but maybe not 150 years.”
And Kelly said the case against the Madoff employees who were ultimately convicted “would have probably been impossible.”
According to Kelly, Madoff hatched his plan with his right-hand man Frank DiPascali, who ran operations on the 17th floor where the Ponzi scheme documents were produced.
But Madoff’s plan fell apart when his sons, Mark and Andrew, went directly to authorities after he confessed his crime to his family, instead of waiting for a week as Madoff had requested.
FBI agents arrived on the 17th floor as DiPascali and others were in the midst of the massive shredding operation.
The ability of the FBI to move in and stop the destruction of evidence underscores the significance of the Madoff sons' decision to ignore their father’s request for a week “to tie up some loose ends.”
“DiPascali was furious, when he hears on the news that Madoff had been arrested, because they were supposed to do it together,” said Kelly. “DiPascali panicked and that’s when he reached out for his attorneys and destroyed his cell phone."
DiPascali soon agreed to become a government witness. He pleaded guilty, testified against others who worked for him and then died of lung cancer before he could be sentenced.
Former FBI agent Kelly says he still wonders what else Madoff had planned for the end game.
“Why didn’t Madoff flee? He had $600 million cash in the bank. You can find some place in the world that will take you for $600 million,” Kelly said.
Instead, Madoff is currently serving a 150-year sentence in a medium security facility in North Carolina.