Annette Bongiorno, 62, of Boca Raton, Fla., was released in the afternoon so she could be taken to her second home in Manhasset, Long Island. As she left the courthouse, she said she was grateful to be freed.
"I'm thrilled. I can't wait to get home," she said. She had been jailed in Manhattan after failing to post $5 million bail.
At a series of bail hearings in recent weeks, prosecutors had sought to convince U.S. District Judge Taylor Swain that Bongiorno should stay locked up because she could use millions of dollars alleged proceeds of Madoff's epic fraud to flee.
But after learning that the government had moved to freeze $7.6 million in Bongiorno's assets, Swain agreed to lower the bail to $3 million.
Defense attorney Maurice Sercarz had argued his client "deserves to be at liberty in her own home" while she fights the charges.
Authorities allege Bongiorno helped Madoff cover up a multibillion-dollar Ponzi scheme that made her wealthy as it wiped out the life savings of thousands of clients.
A new indictment recently named Bongiorno along with another back office worker, Joann Crupi, former operations chief Daniel Bonventre and computer programmers Jerome O'Hara and George Perez. The four have pleaded not guilty and remain free on bail.
The indictment alleges that Bongiorno and Crupi, 49, "'executed' trades in the accounts of (wealthy clients) only on paper ... and that achieved annual rates of return that had been predetermined by Madoff."
Prosecutors say Bongiorno deposited about $920,000 in her own Madoff account from 1975 to 2008 and withdrew more than $14 million in investor funds over the same period to buy expensive homes and pay for other luxuries.
Madoff, 72, pleaded guilty to fraud charges last year and is serving a 150-year prison sentence.
An investigation continues to determine who knew about or assisted in Madoff's two-decade fraud. Still under scrutiny are Madoff's brother Peter and son Andrew, who were executives in the Madoff firm's market-making and proprietary-trading business. Neither has been charged.
Madoff's eldest son, Mark, who had also worked at the firm, committed suicide on the two-year anniversary of his father's arrest.
Bongiorno pleaded not guilty on Friday to the new indictment. A pretrial hearing was set for Jan. 14.