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Police: Madoff's top deputy remains in custody

Frank DiPascali, a former top deputy to imprisoned Ponzi schemer Bernard Madoff, has been released from prison after having been denied two prior bail requests, according to the Federal Bureau of Prisons' Web site.
/ Source: Reuters

Frank DiPascali, swindler Bernard Madoff's right-hand man who admitted helping his boss run a decades-long multibillion dollar fraud, was moved from a New York jail but he remains in custody, law enforcement sources said on Tuesday.

The Federal Bureau of Prisons Web site lists DiPascali, 53, as having been "released" on Nov. 12, but two law enforcement sources said he had been moved from the Metropolitan Correctional Center in Manhattan and remained in custody.

A spokeswoman for the Federal Bureau of Prisons also said DiPascali was still in federal custody. No further explanation was provided for the entry on the bureau's Web site. A spokeswoman for the office of the U.S. Attorney in Manhattan declined to comment.

DiPascali has been in the jail awaiting a prison sentence since he pleaded guilty in August to 10 criminal charges for his role in the $65 billion Madoff fraud that bilked thousands of investors worldwide. DiPascali had worked for Madoff's firm since 1975, rising to become chief financial officer.

He is cooperating with government investigators and faces the possibility of being sentenced to spend the rest of his life in prison. Sentencing is expected next year. Madoff is serving a 150-year prison term in North Carolina.

DiPascali's lawyer did not immediately return calls for comment.

Last week, two former computer programmers for Bernard L. Madoff Investment Securities LLC, Jerome O'Hara and George Perez, were arrested and charged with designing computer codes to falsify investor records and taking hush money from Madoff and DiPascali to keep the fraud going.

U.S. District Judge Richard Sullivan had denied bail to DiPascali, saying there was too great a risk that he could flee before his sentencing. There was no new ruling regarding DiPascali's status on the court's public record.

Madoff was arrested last Dec. 11 when the Ponzi scheme in which early investors were paid with the money of new clients, collapsed in the declining economy.

The case is U.S. v DiPascali, U.S. District Court, Southern District of New York, No. 09-00764.