JP Morgan Chase staff warned one of the bank's chief risk officers in series of emails that Bernard Madoff, the jailed broker who ran a Ponzi scheme, was performing suspicious transactions, according to information released in a law suit.

In a $6.4 billion action by the trustee attempting to recover money for Madoff's victims, JP Morgan's email archive has been opened up and numerous messages ahve been published. The lawsuit was 'unsealed' last week , and accuses JP Morgan of "aiding and abetting" Madoff's fraud. The bank denies the allegations and said it will defend itself "vigorously".

One employee is even detailed in the lawsuit as telling the risk officer that a simple search on Google would have shown the "well-known cloud" over Madoff.

In one email sent in June 2007, the risk officer allegedly wrote he had been told by a colleague “that there is a well-known cloud over the head of Madoff and that his returns are speculated to be part of a [P]onzi scheme".

The colleague "said if we google the guy we can see the articles for ourselves....I think we owe it to ourselves to investigate further", the complaint said. However, the risk officer then allegedly still signed off $250 million in structured products, the complaint said.

JP Morgan branded the lawsuit as "meritless" and "based on distortions of both the relevant facts and the governing law”.

“Contrary to the trustee’s allegations, JPMorgan did not know about or in any way become a party to the fraud,” it said.

The email was sent nearly a year and a half before Madoff was charged with presiding over a near $20 billion fraud. Ponzi schemes are fraudulent investment scams that pay returns not from profit but often from from money paid by subsequent investors.

In the lawsuit against JP Morgan, Madoff victim trustee Irving Picard is seeking $1 billion in fees and profits allegedly earned by JP Morgan as primary banker to Madoff, as well as a further $5.4 billion in damages.

Picard accuses the bank of ignoring suspicious transfers by Madoff and concerns raised by staff working with Madoff's products. It is one of scores of lawsuits filed by Picard in recent months, some of which have already been settled, and had been kept sealed at JP Morgan's request.

Other emails in the lawsuit contain comments that Madoff's business "doesn't look pretty" and that Madoff "will not allow us to conduct any due diligence on him".

JP Morgan said it had followed all laws and regulations governing bank accounts and that the revenues it earned from Mr Madoff’s account “were modest and entirely consistent with conventional market rates and fees.”

After the bank bought Bear Stearns in 2008 - as the industry reassessed hedge fund exposure - it began taking money out and away from Madoff products. It also reported Madoff to the Serious Organised Crime Agency.

Madoff, who turned himself in to authorities in 2008, is serving a 150 year sentence for fraud.

In separate lawsuits filed by Picard against other financial institutions, the complaints question why a series of banks failed to question Madoff's alleged avoidance of real time statements for clients, even though the systems had entered into common use by that time.