The Feds want Bernie Madoff where they can watch him pre-trial...behind bars.

Seems that Bernie Madoff's Ponzi Scheme has the Feds pissed-off. As it should. Pissed-off enough, in fact, that Federal prosecutors are calling for a rather "unusual" move for someone who is accused of this grade of "white-collar" crime and who holds the social status Madoff does. According to this Associated Press article (hosted at the Washington Post), it seems that Bernie may well be learning some new "house rules"...those of the Big House. Club Fed.:

"US govt to NY judge: Jail Madoff without bail" ("Fair Use" claimed for all quotes.)

http://www.washingtonpost.com/wp-dyn/content/article/2009/01/06/AR2009010600547_pf.html

According to this story. it seems that Mr. Madoff--who was originally released on bond without restrictions but is now under tight surveillance by Federal authorities--may have violated the freeze on his assets by sending along a few "little" "heirlooms" to relatives:

Besides watches and jewelry, other items included $25 cufflinks, pens and a $200 pair of mittens.

"Little heirlooms"? How about not-so-little: One "package" may have been worth over ONE MILLION DOLLARS according to the Feds.

His attorney claims it was all an "innocent mistake":

Madoff's lawyer, Ira Sorkin, said his client did not violate a court-imposed asset freeze by mailing heirlooms through the post office to his brother, a son and daughter-in-law and a New York couple vacationing in Florida....

Sorkin called it an innocent mistake and said Madoff and his wife sought the return of the items they had sent on Dec. 24 as soon as they were told they could not send them out. He also suggested that some of the items mailed belonged to Madoff's wife, and therefore were not subject to a court order at that time.

"We maintain it happened innocently..."

So, some of the items belonged to the wife and were not under the "freeze" order? I would think that would raise the question as to why ANY of them belonging to her were transferred. Like, did she hold clear title to any of it? Or were they transferred to her by hubby when he realized he was about to get nailed? In addition, the timing of the moves indicate that "innocent mistake" may well be the whopper of the month:

Sorkin said lawyers learned for the first time that the watch and jewelry had been sent to relatives and the couple in Florida when they were preparing a statement of Madoff's assets on Dec. 30 that had to be turned over to the Securities and Exchange Commission a day later.

Nice. Don't tell YOUR DEFENSE LAWYERS that you have passed on assets that may be "frozen" until the last minute. Although it could be asked why the attorneys did not keep an eagle eye on Madoff, since it appears this latest move to "help out" friends, associates, and family was NOT unprecedented:

The complaint filed [by the Feds] at the time of Madoff's arrest said he had sought to distribute $200 million to $300 million he had left to selected employees, family and friends.

I would say Madoff is looking out for his own..

More information: At the hearing on January 6, 2009, the prosecutor supported his argument that Madoff should be jailed because he was a "danger to the community" by dissipating assets that could be used to provide restitution to victims; Madoff did not enter a plea because an indictment has not yet been handed down.

The judge has ordered both sides to submit written arguments this week to be ruled on later.

Looks like Bernie Madoff will NOT have to learn to NOT drop the soap...yet... As reported by the Associated Press--"Judge say money manager Madoff can remain free on bail in penthouse with more restrictions"--Mr. Madoff can remain free on bond:

http://hosted.ap.org/dynamic/stories/M/MADOFF_SCANDAL?SITE=NYUTI&SECTION=HOME&TEMPLATE=DEFAULT

[T]he judge was not swayed by the [prosecution's] arguments that Madoff represents an economic danger to the community because of the size of the fraud and his action in mailing the gifts.

..."The government fails to provide sufficient evidence that any potential future dissemination of Madoff's assets would rise to the level of an economic harm," Magistrate Judge Ronald L. Ellis wrote.

..."The legal issue before the court is not whether the government has carried its burden of demonstrating that no condition or combination of conditions can be set that will reasonably assure Madoff's appearance and protect the community from danger,"

In other words, the judge said "Unless you can show that he was about to get on a plane with all the assets he can carry to somewhere where which does not recognize extradition proceedings from U.S. courts, I cannot order him jailed. The mere fact that money may be dissipated is NOT enough to consider him a danger to the larger community (even if the people he cheated might have a lesser chance of recovery)."

But just in case, the judge DID put additional "watchdogs" on Madoff; the new restrictions will force him to:

[C]ome 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.

In other words, Madoff might as well be behind bars since he will have no more liberty to use the mails unsupervised than Inmate 1234567 would. Since it's already known he probably used the mails because there was no other way to get the stuff out, the new restrictions likely will shut off the "tap".