Disgraced financier Bernard Madoff, accused of orchestrating a $50 billion fraud, was placed under house arrest today as BNP Paribas became the latest European bank to be sideswiped by the scandal.
A federal judge ordered the 70-year-old former pillar of Wall Street confined to his $7 million Manhattan apartment and told Madoff's wife to surrender her US passport by noon today.
Mr Madoff will be fitted with an electronic ankle bracelet and will only be allowed to leave his home for appointments prearranged with authorities.
This afternoon, Madoff and his wife Ruth visited the federal court to sign an agreement to forfeit their Manhattan apartment and property in Montauk, New York and Palm Beach, Florida if they failed to adhere to the bail conditions.
The changes in bail conditions for the one-time Nasdaq Stock Exchange chairman were ordered a day after US Securities and Exchange Commission Chairman Christopher Cox offered an embarrassing mea culpa for the agency's lack of oversight of Mr Madoff's investment advisory firm.
BNP's stock was the main loser among Europe's top banks after it announced an unexpected 11-month loss at its CIB investment bank unit, blamed partly on exposure to Mr Madoff.
Today, the US Attorney General Michael Mukasey removed himself from involvement in the financial fraud investigation of Mr Madoff. A Justice Department spokesman declined to discuss the reason.
Mr Madoff was arrested on December 11th after telling his two sons and federal investigators that he'd been using money from new investors to pay off old ones in a Ponzi scheme - a scheme which offers unusually high returns, with early investors paid off with money from later investors
He said clients of his New York-based investment-advisory firm lost $50 billion.