Plea deal is possible in Madoff fraud case

NEW YORK — Bernard Madoff returned to court in a bulletproof vest Wednesday and won another round in his fight to stay out of jail. But a larger issue loomed over the court: negotiations for a potential plea deal.

Bail fights such as this usually carry motivations that are never stated on the court record, and the securities fraud case against Madoff appears laden with them.

Experts say prosecutors may want him in jail to increase pressure on him to cooperate or to reach a plea deal more quickly. Or they might want to punish him for not cooperating enough, while yielding to public pressure to make an example out of Madoff during the nation's economic troubles.

"Like any defendant, a person who is already in (prison) has much greater incentive to resolve it than someone on release who is looking at a significant term if convicted," said Michael Garcia, the U.S. attorney in Manhattan until days before Madoff's arrest.

Madoff has become one of the most vilified men in America since he confessed to stealing $50 billion last month in what may be the largest Ponzi scheme ever. The scandal has touched every corner of the world, wiping out life fortunes, decimating charities and apparently pushing one investor to commit suicide.

Investors are furious that he has been allowed to remain free on bail while being accused of such a sweeping fraud.

They've been so angry that authorities have taken measures to protect Madoff's life. He arrived in court wearing the bulletproof vest, and his apartment is also equipped with a panic button that allows him to notify security guards of anything suspicious.

He is also under the constant watch of armed guards and video surveillance in case he tries to flee.

Madoff did not speak or show much emotion during the hearing, although he privately conferred with his lawyers. He left the courthouse and returned to house arrest in his $7 million Upper East Side penthouse after a judge upheld an earlier ruling that Madoff can remain on bail.

Judge Lawrence M. McKenna did take Madoff lawyer Ira Sorkin up on his offer to provide an inventory of any valuables in the homes of Madoff and his wife in Montauk, N.Y., Palm Beach, Fla., and France. It must be finished within a week.

Prosecutors have been making a strong push to have Madoff jailed for mailing more than $1 million in jewelry to relatives and two close friends over the holidays. Assistant U.S. Attorney Marc Litt said Wednesday the gifts are further proof that Madoff "cannot be trusted under any set of conditions short of detention."