Bernard Madoff, the Ponzi schemer who scammed billions from investors, may be currently serving his 150 year prison sentence, but some of his associates are only now facing trial. And were they ever up to some bad deeds—if you believe Madoff's former right hand man.

Frank Dipascali, described as Madoff's lieutenant, is cooperating with the feds and testified against his former colleagues, Joann Crupi, Jerome O'Hara, Annette Bongiorno, Daniel Bonaventure and George Perez yesterday. According to Dipascali, here's how they dealt with audits:

Describing an audit of Madoff's business by KPMG, DiPascali said one of the major accounting firm's auditors asked to see trading data for a certain date. The data couldn't be produced immediately, said DiPascali, because it didn't exist. O'Hara and Perez, aided by Crupi, quickly crafted a voluminous report filled with phony investment trades, he testified.

Checking on the progress of what he termed the frantic effort, DiPascali said he saw the co-workers "throwing the document around the room like a medicine ball." Why? Because they wanted to rumple the pages so the auditor wouldn't suspect the document was brand new.

Dipascali, who faces 125 years in prison, further explained the pro tip to skirting audits, "They explained to me that the document should look used, and I should not bring a hot, warm piece of paper up to an auditor. They had put it in the refrigerator."

The five defendants say that they are innocent and were duped by Madoff; the federal prosecutors say they knew it was a scam and were willing co-conspirators.