Judge Considers Immediate Prison for Madoff for Mailing Valuables

January 7, 2009

(ChattahBox) — Bernard Madoff, remains free on $10 million bail to the dismay of many. But a federal judge is now considering a request by prosecutors to send him to prison for mailing valuables in violation of an asset freeze. Madoff, 70, was charged last month for allegedly directing a $50 billion Ponzi scheme out of his New York investment firm. He was originally ordered to have electronic monitoring and a 7 p.m. curfew. He is now barred from leaving his Upper East Side Manhattan apartment except for court appearances, and his building is monitored by security guards and video surveillance.

Assistant U.S. Attorney Marc Litt said today in Manhattan federal court that Madoff disposed of five items including “very valuable jewelry,”. The government has three of the items, Litt told U.S. Magistrate Judge Ronald Ellis. Defense lawyer Ira Sorkin said the objects, including watches and cuff links, were heirlooms innocently sent to Madoff’s relatives. Sorkin said he told his client to retrieve them and alerted the government.

Ellis declined to immediately rule on the government request, asking for legal briefs from both sides by Jan. 7. As Madoff fought today to stay out of jail, his alleged victims continued to detail their losses with him and regulators sought to identify assets they could use to repay customers.

Irving Picard, the trustee appointed to supervise the unwinding of Madoff’s firm,  has identified $830 million in liquid assets in Madoff’s defunct brokerage firm, Bernard L. Madoff Investment Securities LLC, according to the Securities Investor Protection Corp. The assets may be subject to recovery by Madoff’s customers, SIPC Chief Executive Officer Stephen Harbeck told a congressional committee today in prepared testimony.

Picard sent 8,000 claim forms Jan. 2 to people who appeared to have invested with Madoff, and published a notice telling them how to recover lost money. The forms were sent to people “who appear to have been customers” of Madoff’s firm “with open accounts within the past 12 months,” according to a statement. Madoff’s advisory business was estimated to have had more than 4,000 customers, people familiar with the matter said last month.


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