Ponzi scheme artist Bernard Madoff who was accused of swindling the business world of a staggering $50 billion had been granted bail against the assertion of prosecutors that he is a flight risk and an economic threat to the community. During the holidays while waiting for indictment, the former Nasdaq chairman sent friends and relatives diamond bracelets, jewelries, and gifts amounting to about $1 million in violation of a court-ordered freeze.
But Federal Magistrate Judge Ronald Ellis of Manhattan ruled that Madoff (who did not have prior convictions,) could stay in his luxurious $7 million Eastside Manhattan apartment with some additional restrictions— instead of being locked in jail.
“The anxiously awaited bail decision does put additional restrictions on Madoff, including forcing him to come up with a list of items at his apartment and allowing a security firm to check on the items. The security company will also be allowed to search all outgoing mail from Madoff to ensure that no property has been transferred”.—AP (01/12/09, Neumeister, L)
The judge’s decision disappointed and infuriated many who were victimized by the fraud, supposedly the largest ever in financial history. They believed the accused swindler who was reportedly fitted with an electronic surveillance tag on his ankle got a “different brand of justice than the guy in the street.”
Madoff’s decades-long fraudulent business activity operated similar to a pyramid scam under the guise of a legitimate trading powerhouse which promised high investment yields with low fees. His company which started in 1960 attracted high profile banks, industry leaders, well-connected individuals, loyal friends, and rich celebrities. R. Thierry Magon de la Villehuchet, a prominent hedge fund manager-client who lost $1.4 billion committed suicide in his office in Madison Avenue last month.
In spite of the gravity of the accusations and the public clamor that Madoff be confined in prison, the judge’s decision to put him on house arrest shows how the legal system operates. Following the course of a criminal proceeding, it will take some time before a conviction, if apt for this case, will be decided.
Of course this isn’t consolation. The erosion of trust is astounding. At the back of this monumental fraud, the government regulators appear negligent for the red flags of fraud has been there for years. They have not done a good job in protecting American citizens—especially those ordinary investors on the street. (Photo Credit: Adam Crowe) =0=