Prosecutors indicate Madoff plea may be in works

NEW YORK -- Federal prosecutors in the Bernard Madoff case filed a court motion Friday signaling they may be nearing a plea bargain deal with the disgraced financier.

The one-sentence filing stated that Madoff may be ready to waive his right to a criminal indictment involving allegations he masterminded a decades-long financial scam that victimized investors worldwide.

The filing stated that prosecutors would instead file a court information "upon the defendant's waiver." Such a procedure is commonly used when both sides in a criminal case have reached agreement on a guilty plea.

"It suggests the parties are getting close to a plea bargain deal," said Columbia University law professor John Coffee, a securities law expert. "But it's not yet clear what that deal will be."

Prosecutors face a March 13 federal court deadline to either file an indictment or reach agreement on an alternative disposition of their Madoff investigation. The case has been assigned to U.S. District Judge Denny Chin, for a scheduled March 12 hearing.

Chin also scheduled a Tuesday hearing on potential conflict of interest questions involving Ira Lee Sorkin, Madoff's lead defense attorney. Sorkin previously defended two Madoff-linked suspects in a previous case, and his father, now deceased, was a Madoff investor.

Madoff was arrested in December when he told an FBI agent he'd run a massive Ponzi scheme, in which money from new investors is used to pay prior ones. He remains under house arrest in his Manhattan apartment on $10 million bail.

Rebekah Carmichael, a spokeswoman for Manhattan U.S. Attorney Lev Dassin, declined to discuss the court filing. Sorkin also declined to comment.

Coffee, however, said one of the main questions left unanswered by the filing involves whether the expected court information would include more than a single criminal count against Madoff.

"A one-count information on a charge of securities fraud would likely mean a (prison) sentence of 20 years," said Coffee. "I think that would really bother the many victims who are out there. They would want to see Madoff sentenced to 100 years."