In late May, the Financial Market Authority — Austria's top financial supervisory authority — revoked Bank Medici's banking license.

Kohn, a former adviser to Austria's economics and foreign affairs ministers and the Vienna Stock Exchange, owned 75 percent of Bank Medici, which recently changed its name to 20.20 Medici AG. Bank Austria, a unit of Italy's UniCredit SpA, held the remaining 25 percent. The Journal said prosecutors suspect Kohn may have used the Medici funds as "feeders" that supplied Madoff with an estimated $3.5 billion from European investors. In return, it said, they believe she was paid more than $40 million.

But Theiss, her attorney, said Kohn headed Medici's supervisory board, not the bank itself.

"Her job was not to generate business," he said. "Her job was only to control and to check and to act as a supervisor — not to work at the front."

Carolin Treichl, a Bank Medici spokeswoman, denied the bank was involved in any wrongdoing.

"The company itself has suffered terrible damage" because of Madoff, she told the AP.

Officials have refused to release affidavits or other records relating to the case, citing the ongoing investigations and Austria's strict privacy laws.

The Austrian newspaper Der Standard said the U.S. Justice Department was investigating roughly $32 million in payments that Bernard L. Madoff Investment Securities LLC allegedly made between 1998 and 2008 to Infovaleur, Inc., a New York company the paper said is owned by Kohn.

Prospectuses for the Medici funds now being examined by prosecutors made no mention of Madoff, Der Standard said.

That's because they were invested in S&P 500 stocks, Theiss said, contending that Medici and Kohn have simply been targeted by frustrated Austrian investors doing whatever they can to attempt to recover some of their losses.

"They want to put pressure on her," he said.

Also Monday, the French prosecutor's office said it has opened a preliminary inquiry into losses the Credit Industriel and Commercial bank says it suffered due to dealings with Madoff. CIC is believed to have lost about $150 million as a result of its participation in 2006 with the Bayern Landesbank and Ixis bank, now renamed Natixis, in a high-return financial operation. The investments by the banks made their way to an entity belonging to the Madoff group.

A French judicial source, speaking on condition of anonymity because the investigation is under way, says the probe also looks into the role by Ixis and the Bayern Landesbank. Vincent Asselineau, a spokesperson for CIC, had no comment.

A federal judge in New York rejected Madoff's pleas for leniency and sentenced the 71-year-old on June 29 to spend the rest of his life in prison for an "extraordinarily evil" swindle that took a staggering toll on thousands of victims.

The massive Ponzi scheme run by Madoff since at least the early 1990s demolished the life savings of thousands of people, wrecked charities and shook confidence in the U.S. regulatory system