20 Dec 2008

Tighter security for alleged fraudster

9:36 pm on 20 December 2008

A Wall Street fund manager accused of massive fraud has been put under round-the-clock house arrest in his Manhattan apartment "to prevent harm or flight".

The order replaces an earlier night curfew imposed as part of the bail of $10 million for Bernard Madoff, 70.

With angry investors hiring lawyers to try and recover losses, and photographers, TV crews and journalists gathered outside the apartment building, authorities apparently decided to put Madoff under even more surveillance.

Meanwhile, investigators are poring over masses of documents as they probe the scheme that may have involved as much as $US50 billion.

An ethics investigation has also begun into the small accounting firm that supposedly signed off the books of Madoff's investment management business.

Madoff, who was arrested on 11 December, is accused in a criminal complaint of one count of securities fraud. In the complaint he is quoted as saying his business was "basically a giant Ponzi scheme" whereby earlier investors are paid off with the investments of newer clients.

Investigators are also trying to establish whether his wife Ruth had any role in the scheme.