Reporting from New York — Bernard Madoff isn't going to jail -- at least not this week.
A federal judge ruled today that the former money manager may remain free on bail pending the outcome of criminal charges that he bilked investors in an alleged $50-billion worldwide Ponzi scheme.
U.S. Magistrate Judge Ronald Ellis rejected a request by prosecutors to jail Madoff on a bail violation for sending $1 million in jewelry and other valuables to family and friends.
Prosecutors had argued that Madoff and his wife, Ruth, mailed the items -- including Tiffany and Cartier watches, an emerald ring, necklaces and cufflinks -- in clear violation of a court order barring the dissipation of his assets.
Madoff's attorneys responded that it was an innocent act meant to preserve family heirlooms.
In a 22-page ruling, Ellis imposed tighter restrictions on Madoff, including requiring him to compile an inventory of his valuable portable possessions and ordering that his outgoing mail be inspected to ensure he isn't disposing of assets.
However, Ellis ruled that Madoff may continue living in his New York City apartment under 24-hour home detention.
The government had failed to prove that Madoff is a flight risk, Ellis wrote.
"The issue at this stage of the criminal proceedings is not whether Madoff has been charged in perhaps the largest Ponzi scheme ever, nor whether Madoff's alleged actions should result in his widespread disapprobation by the public, nor even what is appropriate punishment after conviction," Ellis wrote.
"The legal issue before the Court," he continued, "is whether the government has carried its burden of demonstrating that no condition or combination of conditions can be set that will reasonably assure Madoff's appearance and protect the community from danger."
The government's request to revoke bail marked a reversal from its initially conciliatory approach.
Prosecutors had earlier agreed to lighten Madoff's bail conditions after he was able to secure only two of the required four co-signers for his $10-million personal-recognizance bond.
Legal experts said the government's aboutface may reflect the public pressure that prosecutors feel from Madoff investors, who are irate that he is allowed to stay in his luxury apartment while they are out billions of dollars.
"Now that there's been this huge public outcry and the U.S. attorney's office miscalculated public sentiment, they're now trying to backtrack," said New York defense attorney Bradley Simon.
Prosecutors also were likely incensed that Madoff would flout the terms of his bail after they had been so accommodating, experts said.
"This is about 'how the hell could you do this to us when we let you out?' " said Chris Clark, white-collar criminal defense attorney at Dewey & LeBoeuf in New York.
