Judge rules Madoff can remain free on bail

Bernard Madoff won the latest round in his fight with prosecutors over his bail package Wednesday as a federal judge ruled that he could remain free, brushing aside arguments by the government that the money manager needed to be in jail because he couldn’t be trusted.

U.S. District Judge Lawrence M. McKenna ruled that prosecutors did not make a compelling argument that Madoff was a danger to the community or a flight risk -- the two considerations in deciding whether to grant bail.

Authorities say Madoff has said he ran a $50-billion Ponzi scheme, paying investors with money raised from new clients.

Madoff did not speak or show any emotion during the hearing, although he conferred privately with his lawyers. He left the courthouse and returned to his $7-million Upper East Side penthouse, where he has been under house arrest and watched by armed guards around the clock. His outgoing mail is also being searched to ensure that he doesn’t try to pass along any assets that could be used to reimburse investors.

Defense lawyer Ira Sorkin told the judge that such extreme restrictions made it “close to impossible to dispose of anything valuable.”

“I think the chances of Mr. Madoff fleeing at this point are as close to nil as you can get,” Sorkin said.

The government believes that Madoff should be jailed because he sent more than $1 million in jewelry and gifts to family and friends over the holidays.