US FINANCIER Bernard Madoff has taken the first public step to pleading guilty to criminal charges of masterminding the biggest fraud in Wall Street history.

A document filed yesterday in the US district court in Manhattan said US prosecutors intended to file a “criminal information” in their case against Madoff “upon the defendant’s waiver of an indictment”.

A hearing was scheduled on the charges for March 12th, according to a clerk in the court of US district judge Denny Chin, who was assigned the case.

Typically in white-collar crime cases in the US, such an information document indicates a defendant is expected to plead guilty, sometimes to the original charge or new charges.

Madoff is the only person charged in the case. Prosecutors have until March 13th to indict the once-respected Wall Street trader and investment manager, or reach a plea agreement.

The document filed yesterday “speaks for itself”, said Daniel Horwitz, one of Madoff’s lawyers.

Authorities said Madoff confessed in December to running “a giant Ponzi scheme” with losses of as much as $50 billion (€39.6 billion). A Ponzi scheme is one in which early investors are paid with the money of new clients.

Banks, wealthy investors, small investors and charities all over the world said they were defrauded by Madoff.

“This is the first step in order to enter a plea agreement,” said Peter Henning, a professor at Wayne State University Law School in Detroit and a former federal prosecutor.

“Most plea agreements are done by a criminal information rather than an indictment.”

Madoff was arrested and charged with one count of securities fraud on December 11th, and faces up to 20 years in jail.

He was 70 at the time of his arrest and could spend the rest of his life in prison.

In the meantime, he is out on $10 million bail and is under house arrest in his New York apartment.

Meanwhile, a hearing has been scheduled for Tuesday over a potential conflict of interest for Ira Sorkin, one of Madoff’s lawyers. – (Reuters)