Peter Madoff, who pleaded guilty to aiding Bernard Madoff’s fraud while claiming he didn’t know his older brother was running a vast, decades-long Ponzi scheme, was sentenced to 10 years in prison.

U.S. District Judge Laura Taylor Swain yesterday sentenced Peter Madoff after considering pleas from victims of the fraud that she not show him any mercy. As part of an agreement with prosecutors, Madoff agreed not to seek less than the maximum 10- year prison term allowed by law.

In a 55-minute hearing in Manhattan, Swain said the notion that Peter Madoff didn’t know about the wide-ranging fraud at firm is “frankly, not believable.” She urged him to cooperate with investigators who are trying to unravel the Ponzi scheme at his former firm.

“I challenge you to be honest about all that you have done and all that you have seen,” Swain told Madoff before pronouncing sentence.

Peter Madoff, 67, becomes the second person sentenced in the fraud at Bernard L. Madoff Investment Securities LLC, which was exposed in December 2008. Bernard Madoff, who admitted masterminding the scheme, is serving a 150-year sentence in a North Carolina federal prison.

‘Deeply Ashamed’

“I am deeply ashamed of my conduct and have tried to atone by pleading guilty and forfeiting all my assets,” Madoff told Swain. “I am here to accept my punishment from this court.

Swain also sentenced Madoff to one year probation when he’s released and she approved a forfeiture order that Madoff agreed to under which he must surrender all his assets, including Social Security proceeds, up to $143.1 billion. Swain approved the arrangement, which she called ‘‘draconian,’’ saying it ‘‘seals Peter Madoff’s financial ruination.’’

Peter Madoff had asked the court to let him attend his granddaughter’s bat mitzvah next month before he’s ordered to report to prison. At Madoff’s request, Swain said she will recommend he serve his time in a federal prison camp in Otisville, New York, about 70 miles (112.6 kilometers) northwest of New York City. He must report to prison by Feb. 6 at 2 p.m., she said.

Madoff and his lawyers didn’t respond to questions after the hearing. He walked silently through a crowd of photographers and television cameras outside the U.S. courthouse in lower Manhattan, then stepped into a silver BMW sedan and was driven off.

Two Victims

Two victims of the Madoff fraud, Michael T. DeVita and Amy Luria Nissenbaum, addressed the court.

‘‘I ask that you show the same degree of compassion for Peter Madoff that he showed for us -- none,” DeVita said, urging Swain to set aside Madoff’s plea agreement and sentence him to more than 10 years.

“He benefited from this scam for over 30 years and he should be in prison for the same amount of time,” Nissenbaum told Swain. She objected to Madoff’s request to attend the bat mitzvah.

“I find it unacceptable that he has an opportunity to attend a family event and I feel he should go away today,” she said.

150 Years

Anthony Sabino, who teaches law at St. John’s University in New York, said many victims of the Madoff fraud are unlikely to be satisfied with Peter Madoff’s sentence, particularly in comparison with the 150 years his brother received.

“Ten years -- it just seems to be on the low end of the scale,” Sabino said.

In papers filed with the court, Peter Madoff’s lawyer, John R. Wing, said his client was “a victim of his brother’s Ponzi scheme.” Peter Madoff’s “world was shattered” when his brother disclosed the fraud to him, Wing said in the letter, which was made public this week.

Peter Madoff’s guilty plea to two criminal charges came three years to the day after his brother was sentenced to 150 years in prison. During his plea hearing, Peter Madoff told the court he had no knowledge of Bernard Madoff’s scheme until Dec. 9, 2008, the night his brother confessed to him that the investment business was a sham. Bernard Madoff was arrested and confessed to authorities two days later, on Dec. 11.

Paid Expenses

Peter Madoff pleaded guilty to one count of conspiracy and one count of falsifying records of an investment adviser. Both offenses carry maximum sentences of five years in prison.

Peter Madoff admitted to improperly avoiding taxes by having the firm pay many of his expenses, which he didn’t report as income. He also said he filed false reports with regulators that helped conceal the fraud. After learning of the Ponzi scheme, Peter Madoff said he helped his brother parcel out $300 million remaining in the firm to select friends and family members.

Peter Madoff repeatedly lied and violated the trust investors had in the firm, prosecutors said. His crimes began in about 1996 and continued until December 2008 when the firm collapsed, according to the government.

Sham Program

Had regulators and clients known the truth about the compliance program overseen by Peter Madoff, “it is possible that the fraud would have been detected years earlier and losses to the many victims would have been avoided,” prosecutors said in court papers Dec. 14.

Peter Madoff graduated from Queens College and Fordham University Law School, joining his brother’s firm in 1970, according to Wing. He and his wife, Marion, had two children: Shana, who would later work for the Madoff firm, and Roger, who worked as a Bloomberg News reporter and died of leukemia in 2006.

Federal prosecutors have obtained guilty pleas from Madoff’s former chief financial officer, Frank DiPascali, his former accountant, David Friehling, and former employees Craig Kugel, David Kugel, Enrica Cotellessa-Pitz, Irwin Lipkin and Eric Lipkin. They haven’t yet been sentenced.

Also facing charges are former employees Daniel Bonventre, Annette Bongiorno, Joann Crupi, Jerome O’Hara and George Perez. They have pleaded not guilty.

The case is U.S. v. Madoff, 10-cr-228, U.S. District Court, Southern District of New York (Manhattan).