Page last updated at 09:57 GMT, Friday, 9 January 2009

Madoff 'had cheques ready to go'

Bernard Madoff leaves a court in New York (5 January 2009)
Mr Madoff has not yet entered a plea or responded to the charges

Bernard Madoff had $173m (114m) in signed cheques in his office desk, ready to send out at the time of his arrest last month, US prosecutors say.

The cheques were further evidence that Mr Madoff wanted to keep his assets away from his investors, they claim.

The detail was provided in a court filing as prosecutors argued that Mr Madoff should have his bail revoked.

Mr Madoff is accused of running a fraudulent $50bn scheme which saw heavy losses for many investors.

Mr Madoff is currently under house arrest in his New York penthouse.

His $10m bail is covered by that home as well as his houses in Long Island and Florida. A parallel civil case has also seen his assets frozen.

Bail arguments

In court on Thursday, prosecutors accused Mr Madoff, a former Nasdaq stock market chairman, of sending more than $1m worth of jewellery to friends and family over the Christmas holidays.

Investigators previously said that Mr Madoff had planned on distributing more than $200m to his closest friends and family after he realised his scheme had unravelled.

US prosecutors allege that Mr Madoff's business funded investors' returns with cash from new investors - a fraud known as a Ponzi, or pyramid, scheme.

Madoff should not be able to communicate with anyone from his apartment in an unrestricted way
Howard Kleinhauer
Lawyer for former Madoff investor

His defence lawyers have argued that he is not likely to flee nor is he a danger to community, and therefore should remain free on bail.

A court official said a judge would issue a decision on Friday or Monday on the government's request to revoke Mr Madoff's bail and jail him.

Lawyers for investors who are suing to recover losses welcomed the US government's attempt to put Mr Madoff behind bars.

"It should have been done from the first day," said Howard Kleinhauer, lawyer for an investor who placed $10m with Mr Madoff's firm just days before his arrest.

"Madoff should not be able to communicate with anyone from his apartment in an unrestricted way."

Earlier, Britain's Serious Fraud Office said it would open an inquiry into Mr Madoff's business operations in the UK.

The investigation would focus on UK victims and any offences that may have been committed in the UK, the SFO said.

The SFO has called for anyone who has had dealings with any of Mr Madoff's UK businesses - including ex-employees - to assist in the investigation.

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