Man Charged with Fraud Red Flagged

Bernard Madoff, the disgraced financier, who was arrested for fraud after bilking investors out of $50 billion, has been free on bail since his Dec. 11 arrest. On Jan. 5, federal prosecutors argued that he should not be out on bail because he has allegedly sent $1 million dollars' worth of jewelry he owns to family and friends since his arrest — which could be a method of divesting himself of assets so that they cannot be seized in a judgment.

House Arrest Not Enough, Says U.S. Attorney

Madoff, the 70-year-old former chairman of the NASDAQ stock exchange, has been on "house arrest" at one of his New York residences. Many Americans were chagrined to see him wandering the streets freely after his arraignment, since he admits to a massive fraud that has ruined thousands of people financially.

At a hearing in a Manhattan courtroom on Monday, Assistant U.S. Attorney Marc Litt argued that the government's case against Madoff "is strong and getting stronger," and that although Madoff and his wife have surrendered their passports, Madoff is still a flight risk.

Madoff's bail conditions have been tightened up somewhat:

• He was originally free on a $10 million 'personal recognizance' bond
• He was later moved to 24-hour house arrest with a private guards at the multiple entrances to his East 64th street apartment.

Items Mailed Before Wife's Asset Freeze

Madoff's attorney, Ira Sorkin, stated at the hearing that the items sent by the Madoffs were:

• Family heirlooms
• Not worth much money
• Mailed Dec. 24, before Madoff's wife Ruth agreed to a separate freeze of her assets

Sons Andrew and Mark Madoff received three packages; other items were mailed to relatives and friends.

The federal prosecutors' argument is that Madoff poses a risk to the community based on the possibility of his transfer of valuable assets that could instead be used to pay restitution to his victims, both individuals and institutions such as charities and universities. At least one large class action has been initiated against Madoff already.
 
(Source: MSNBC)

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