Investigators searching the office desk of Bernard Madoff after his arrest found about 100 signed cheques, totaling about $173 million, ready to be sent to family, friends, and employees, prosecutors said today.

Assistant US Attorney Marc Litt in Manhattan made the disclosure in a letter submitted today to US Magistrate Judge Ronald Ellis, as part of a renewed request for the judge to jail Mr Madoff prior to his trial.

Prosecutors said earlier in the Madoff saga that Mr Madoff, before his arrest on December 11, had said he wanted to transfer $200 million to $300 million of his investors money to selected family, friends, and employees. Today's news indicates that Mr Madoff was ready to send the money out.

He took $1 million from an investor just three days before he was arrested for running the world's largest Ponzi scheme, according to a law suit filed today.

Hadleigh Holdings, a Miami company, wants Irving Picard, the trustee that is unwinding Bernard L Madoff Investment Securities (BMIS), and JP Morgan Chase, where BMIS had a bank account, to return the $1 million.

In the filing with the US Bankruptcy Court in Manhattan, Hadleigh said that its manager Stanley Krieger began thinking about investing with Mr Madoff several months ago after the fund manager was recommended by Mr Krieger's by friends and colleagues for his stable investment returns.

As a result, Hadleigh transferred $1 million to BMIS's JP Morgan Chase account so that it could be invested in Mr Madoff's funds.

Hadleigh claims, however, that Mr Madoff never obtained legal possession of the money and therefore the cash it should not be included as part of the BMIS liquidation.

Another investor, Martin Rosenman, who wired $10 million to Mr Madoff less than a week before he was arrested, made a similar claim against Mr Irving and JP Morgan Chase last month.

It is thought that Mr Madoff, faced with about $7 billion in redemptions, made desperate last minute attempts to gather enough cash to meet the demands of existing investors in the weeks before he confessed his scam to his sons and was subsequently arrested.

Yesterday it emerged that he took $250 million from one of his closest friends just weeks before he was arrested.

Mr Rosenman and Hadleigh hope that, because they put their cash in towards the end of the scam, it may still be sitting in the JP Morgan Chase bank account.

But in testimony at a House Financial Services Committee hearing last week, the Securities Investor Protection Corporation told lawmakers that Mr Rosenman's cash would be treated like that of all other investors in BMIS.

Mr Irving is currently untangling the assets remaining at the company, while Mr Madoff remains under 24-hour house arrrest at his penthouse in Manhattan. He has so far uncovered $830 million in cash and a further $850 million in liquid assets.

Eventually, these assets will be shared amongst the investors that lost as much as $50 billion in the financial scam.

Mr Madoff's lawyer Ira Sorkin today declined to comment on Hadleigh's claims.

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