The U.S. Attorney’s Office for the Southern District of New York said that the former controller of accounts at Bernard L. Madoff Investment Securities pled guilty to four counts of falsifying records.

The Securities and Exchange Commission simultaneously said that the controller, Enrica  Cotellessa-Pitz, also consented to the entry of a partial judgment in the federal regulator’s civil case against her. 

Preet Bharara, the United States Attorney for the Southern District of New York, said Cotellessa-Pitz pled guilty to “substantive counts” of falsifying books and records of a broker-dealer, falsifying books and records of an investment adviser, and making false filings to the SEC.

Cotellessa-Pitz, who could not be reached for comment, pled guilty before U.S. District Judge Laura Taylor Swain. As part of her guilty plea, she agreed to cooperate with the government’s probe of the Madoff fraud, which took tens of billions of dollars from investors before collapsing in the wake of the 2008 credit crisis.

Also see: How Bernie Made Basket Cases Out of His Customers Accounts

According to the Attorney General’s office, Cotellessa-Pitz was employed at BLMIS from 1978 through December 11, 2008 and become controller in 1998.

The prosecutor’s office said Cotellessa-Pitz helped create “false and misleading entries” in Madoff account records and to disguise transfers of funds.

“The transfers made the Market Making and Proprietary Trading operations of BLMIS appear profitable when they were not,’’ Bharara’s office said.

In addition, Cotellessa-Pitzalso also allegedly helped to create false and fraudulent documents in connection with tax audits of Madoff.

Cotellessa-Pitz, 53, faces a maximum sentence of 50 years in prison.

Cotellessa-Pitz is also subject to mandatory restitution and criminal forfeiture and faces criminal fines up to twice the gross gain or loss derived from the offense.

Judge Swain set a sentencing date for June 22, 2012.

In the SEC case, Cotellessa-Pitz was charged with assisting in falsifying BMIS’s internal accounting records in order to misclassify hundreds of millions of dollars of income purportedly generated by BMIS’s investment advisory operations. Cotellessa-Pitz also falsified financial statements filed with the SEC and other regulators as well as materials that were prepared to deceive SEC staff examiners, federal and state tax auditors, and other external reviewers.

The SEC alleges that Madoff instructed employees to transfer hundreds of millions of dollars from bank accounts holding investor funds to the firm’s operating bank accounts. Madoff’s goal was as simple as it was misleading – to use stolen investor funds to hide the significant losses incurred by BMIS’s market-making and proprietary trading operations.

In November, the Securities and Exchange Commission charged longtime Bernie Madoff employee David Kugel with fraud for his role in creating fake trades to facilitate the massive Ponzi scheme.

The SEC has also charged two other longtime Madoff employees, Annette Bongiorno and JoAnn Crupi, with roles in producing phony account statements that were sent to Madoff investors.

The SEC also charged BMIS’s Director of Operations David Bonventre with falsifying books and records to hide and obfuscate Madoff’s advisory operations.

Tom Steinert-Threlkeld writes for Securities Technology Monitor.