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Tag: Judge Ronald L. Ellis

  • Madoff Bail Restrictions Tightened, But He’ll Stay Home

    It must have been a worrisome weekend for Bernard Madoff.

    Madoff, accused of masterminding a $50 billion Ponzi scheme that has affected investors worldwide, found out Friday that a federal judge planned to rule today whether to revoke his bail and jail him in response to prosecutors’ court pleadings.

    The judge now has ruled — and Madoff will be permitted to stay at home.

    Prosecutors had not proven Madoff was a security or flight risk, Judge Ronald Ellis said.

    But Ellis did tighten Madoff’s bail conditions.

    Bernard Madoff
    Bernard Madoff

    Prosecutors had feared Madoff could transfer assets to family members, friends and employees, thus denyting victims of a means to recover losses.

    Madoff  now been ordered to compile an inventory of possessions and banned from transfering property.

    Federal prosecutors said last week that agents found $173 million in checks in Madoff’s office. The checks were to have been distributed to a list of people Madoff deemed worthy of receiving bonuses and gifts.

    All $173 million could have been dissipated had the checks been distributed — and people who deposited or cashed them could have been sued by victims and forced to return the proceeds.

    Prosecutors also said Madoff sent expensive jewelry and gifts to family and friends. Those gifts must be returned.

    Madoff is under house arrest in his New York City apartment. Under bail terms, he must wear an electronic monitoring advice.

    Baltimore officials now say the city’s police and fire pension funds reportedly lost $3.5 million through an indirect tie to Madoff.

  • Prosecutors Turn Up The Heat On Madoff

    Ponzi schemes almost always have insiders, and sometimes the insiders may not even know they’re insiders.

    In an extraordinary revelation, federal prosecutors said this afternoon that Bernard Madoff took overt steps to distribute bonuses to preferred family,  friends and employees after he realized the Ponzi he created was crashing down around him

    “[When] the defendant’s office desk was searched, investigators found approximately 100 signed checks totaling more than approximately $173 million, ready to be sent out,” said prosecutors Marc Litt and Lisa A. Baroni.

    The assertions were made in a letter to Judge Ronald L. Ellis.

    “The only thing that prevented the defendant from executing his plan to dissipate these assets was his arrest by the FBI on December 11,” Litt and Baroni said. The letter was signed by Litt, under the authority of  Acting U.S. Attorney Lev. L. Dassin of the Southern District of New York.

    Today’s letter by prosecutors marked the first public disclosure that Madoff already had drafted and signed checks, a situation that could have led to an even greater calamity had the checks been mailed and cashed.

    Prosecutors earlier had said only that Madoff had discussed distributing up to $300 million to preferred individuals.

    Here is the  letter from prosecutors.

    Had the preferred parties received and deposited the checks, Madoff’s assets would have been depleted by $173 million, putting family members, friends and employees in the position of getting sued to disgorge illegal profits.

    Prosecutors said earlier this week that Madoff and his wife, Ruth, sent more than $1 million in jewelry and other items to friends and family after his arrest. The government viewed it as a bail violation, saying Madoff should be jailed.

    Madoff’s attorney, Ira Sorkin, explained Madoff’s behavior as an innocent mistake.

    Today’s filing by prosecutors makes it clear that the government believes home-detention with electronic monitoring weren’t enough to keep Madoff in line while awaiting trial. The gloves are off, and prosecutors now are playing hardball.

    “The nature and circumstances of the offense charged are unprecedented,” prosecutors told the judge. “The defendant has admitted to perpetrating one of the largest, if not the largest, Ponzi schemes in history — a scheme that required the defendant to lie routinely to thousands of people and a scheme which has caused extraordinary damage to individuals, families and institutions all over the world.”