Bernard Madoff, the disgraced Wall Street trader accused of conning clients out of $50bn (£33bn), had $173m in signed cheques on his office desk when he was arrested, which prosecutors say shows he sought to keep assets from fleeced investors.

In a filing in a federal court in New York today, prosecutors argued the 100 cheques are further evidence Madoff should be jailed pending trial.

"The only thing that prevented the defendant from executing his plan to dissipate those assets was his arrest by the FBI on December 11," prosecutors argued.

Assistant US attorney Marc Litt argued that if Madoff remains free he cannot be trusted not to disperse his assets because he perpetrated a "scheme that required the defendant to lie routinely to thousands of people and a scheme which has caused extraordinary damage to individuals, families, and institutions all over the world."

Madoff remains under house arrest in his luxurious $7m Manhattan apartment. US Magistrate Judge Ronald Ellis must now decide whether to remand Madoff to jail. Madoff's attorneys argue he is not a threat and should remain free.

The revelation came as the Serious Fraud Office announced it is opening an investigation into Madoff's UK operations.

Police said the investigation would focus on "UK victims and any criminal offences that might have been committed in the UK".

"We will work closely with other law enforcement agencies to discover the truth behind the collapse of these huge financial structures. And we again ask for help from ex-employees and others," the SFO director, Richard Alderman, said.

The decision comes after the SFO was handed an interim report by Grant Thornton, the accountancy firm acting as the provisional liquidators of Madoff's UK operations.

The SFO said it was liaising closely with law enforcement counterparts in the US and with the City of London police.

It has appealed for investors or other stakeholders involved with the Madoff UK businesses to get in touch in the hope that they might shed light on the trader's dealings.

Madoff is accused of running a fraudulent pyramid scheme in one of the largest cases of financial corruption in US history. Long considered a pillar of the Wall Street community, he was arrested on 11 December after allegedly confessing to his sons that his fund was a "giant Ponzi scheme". He was later placed under curfew and ordered to wear an electronic tag. The 70-year-old faces a jail term of up to 20 years and a £3m fine.

In addition to preparing the cheques, prosecutors say Madoff posted several packages of jewellery - including 13 watches, a diamond necklace, an emerald ring, two sets of cufflinks, a diamond Cartier watch, among other valuables totalling more than $1m - to family members and friends in contravention of an order freezing his assets. Government officials have recovered much of the jewellery.

The jewellery mailings show Madoff's "willingness to disobey an explicit court order", even an order to appear in court.

They also allege he planned to distribute more than $200m to friends and family when he realised the scheme was unravelling.

The list of people allegedly defrauded by Madoff include the American film director Stephen Spielberg, the US actor Kevin Bacon, and Nicola Horlick, the UK asset manager dubbed "superwoman".

Scores of banks, charities, and hedge funds worldwide have said they lost money invested with Madoff. The Spanish bank Santander, which owns Abbey, Alliance & Leicester and Bradford & Bingley, has admitted a loss of £2.1bn, and HSBC and Royal Bank of Scotland are nursing losses.

Madoff was registered with the Financial Services Authority, along with his two sons, brother and six other employees of Madoff Securities International, a proprietary trading operation based in London which insisted it was "not in any way part of" the New York firm.

The financier set up a company in the US with barely $5,000 almost 50 years ago. He maintained it as a family operation with its unique selling point that it would be a reliable and trustworthy haven for investments in turbulent times. In an illustrious career, Madoff chaired the Nasdaq stock exchange and even served as an adviser to the US regulator, the securities and exchange commission.