Page last updated at 20:57 GMT, Wednesday, 14 January 2009

Judge rejects Madoff jail appeal

Bernard Madoff (left) leaves a court in New York (5 January 2009)
Prosecutors had claimed that Mr Madoff was a flight risk

A US judge has rejected an appeal from prosecutors that Bernard Madoff should be sent to jail while they continue to probe his alleged $50bn (33bn) fraud.

Prosecutors had lost an argument earlier this week that his bail should be revoked because he violated a court order freezing his assets.

Mr Madoff will remain on bail after a judge confirmed that decision.

Mr Madoff posted more than $1m-worth of jewellery and valuables to relatives and friends before Christmas.

But his lawyer has maintained that his client had not realised this violated the freezing of his assets.

Judge Lawrence McKenna said prosecutors had been unable to make a compelling argument that Mr Madoff was a danger to the community or was at risk of leaving the country - which are the two main requirements for bail decisions.

Complicated

Mr Madoff, 70, a former chairman of the Nasdaq stock market, was arrested and charged on 11 December in what would be Wall Street's biggest Ponzi scheme, one in which early investors are paid-off with the money of new clients.

If convicted, he faces up to 20 years in prison and millions of dollars in fines.

The investment adviser has not appeared in court to formally answer the charge and an 11 February deadline to indict him meaning that he will remain free for at least another four weeks, provided he does not breach the terms of his bail.

Fraud experts have said the purported scheme was too complicated and went on too long to have been carried out by Mr Madoff alone.

The investment adviser, who has been a Wall Street figure for more than 40 years, is the only person accused in the scandal surrounding his firm, Bernard L Madoff Investment Securities.

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