Judge Allows Madoff to Remain Free on Bail
The New York Times
Published: Jan 15, 2009
A federal court on Wednesday upheld a lower court ruling and refused to send the disgraced financier Bernard L. Madoff to jail.
So for now, Mr. Madoff. who is accused of running a $50 billion Ponzi scheme, to stay out of jail and free on bail under house arrest at his luxury Manhattan apartment. In making the ruling, the rejected an appeal filed by federal prosecutors.
The hearing is the latest twist in the court proceedings of Mr. Madoff, in which every turn has been captured in detail by the media. Mr. Madoff’s trip to court was shown live on television, via a camera in a helicopter, as he made his way to Lower Manhattan.
Mr. Madoff did not speak as he was ushered into the courthouse around 1:15 p.m., The Associated Press reported. Metal barricades held back a large group of photographers. Earlier, a silver sport utility vehicle had pulled out of the driveway in front of Mr. Madoff’s home, The A.P. said. Paper on its side windows blocked views inside it.
Prosecutors had initially asked the court to revoke Mr. Madoff’s $10 million bail, secured by various homes held in his wife’s name, saying he had violated a court-ordered asset freeze by sending more than $1 million in jewelry and watches to family members and friends. Prosecutors said that Mr. Madoff had also planned to transfer $200 million to $300 million of investors’ money to family members and friends. When the authorities searched Mr. Madoff’s office desk, they found $173 million in signed checks ready to be sent off.
But a federal magistrate denied the request to revoke bail on Monday, saying prosecutors failed to prove that jailing Mr. Madoff was the only way to prevent him from fleeing or obstructing justice.
In their motion seeking to overturn the appeal, prosecutors argued in court papers filed Tuesday that Mr. Madoff simply could not be trusted to comply with the terms of the bail ruling.
“The defendant should not be trusted with a second chance to dissipate assets,” Lev L. Dassin, the acting United States attorney in Manhattan, wrote in a 49-page legal brief filed late Tuesday with the federal district judge hearing the appeal, Lawrence M. McKenna.
The judge did place additional restrictions on the bail requirements, requiring that Mr. Madoff’s outgoing mail be monitored by a security firm and that an inventory be made of any portable valuables in his Upper East Side apartment. Many of the new bail requirements had already been imposed by Judge Louis L. Stanton of United States District Court, who is handling a civil case brought by the Securities and Exchange Commission.
In their brief, prosecutors try to drive home their argument that Mr. Madoff will simply continue to ignore the requirement.
“First, there is no reason to believe the defendant will be any more likely to abide by Judge Stanton’s order if it made part of the bail conditions than he was when it was an order of a U.S. district judge in a civil case which the defendant is a party,” Mr. Dassin wrote. “Moreover, the defendant, based on his prior actions, should not be given yet another chance to harm the victims in this case.”
Mr. Dassin added, “The best way to prevent the defendant from transferring valuable assets to third parties and to severely impede his ability to do so with respect to his other properties is to detain him.”
© The New York Times. All rights reserved. This article originally appeared in The New York Times.
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