February 13, 2009 / 3:57 PM / 10 years ago

Indicted NY lawyer released on bail into house arrest

NEW YORK, Feb 13 (Reuters) - A lawyer indicted on charges of running a $400 million scheme to sell fake debt left jail on Friday to be put under house arrest with private armed guards in his high-rise Manhattan apartment.

The conditions of bail for Marc Dreier, founder and sole equity partner in a 250-attorney firm, are similar in some respects to those imposed on Bernard Madoff, a more widely known accused swindler who authorities say masterminded a $50 billion global fraud over many years.

Frequently under U.S. law, white-collar crime defendants are allowed out on bail, often with restrictions on their movements.

A judge on Feb. 5 ordered Dreier to sign a $10 million personal recognizance bond co-signed by his son and his mother.

Dreier signed the bond at the Manhattan federal courthouse on Friday and was escorted away by law enforcement agents.

He will wear an electronic monitoring device and is assigned private armed security guards paid by him or his relatives, according to the order by Judge Jed Rakoff of U.S. District Court in Manhattan.

All communications equipment has been removed from the apartment, except for one landline telephone. The judge ordered an alarm to be placed on the 34th-floor apartment’s balcony at Dreier’s expense.

A U.S. grand jury indicted Dreier on Jan. 30, accusing him of securities fraud, conspiracy and wire fraud for lying to hedge funds and investment funds that he was selling promissory notes on behalf of a New York developer and a pension fund in Canada. He pleaded not guilty.

The charges stunned the legal community, and his Dreier LLP firm collapsed. Dreier’s assets are frozen.

Dreier has been jailed since his arrest on Dec. 7 on his return from Canada — unlike Madoff, who has been out on $10 million bail since his Dec. 11 arrest, under house arrest in his luxury penthouse apartment. (Reporting by Grant McCool; Editing by Lisa Von Ahn)

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