07/26/2008 05:12 am ET Updated May 25, 2011

Anne Hathaway's Vatican Con Man Ex Eyes Plea Deal

Anne Hathaway dumped him. The feds busted him. Now accused con artist Raffaello Follieri could be getting ready to cut his losses and make a deal with prosecutors.

"Follieri is in plea discussions," Assistant US attorney Jennifer Burns said late Wednesday as she updated a federal magistrate judge on a series of pending cases during a routine court appearance.

With bail set at $21 million, Follieri has been behind bars since his arrest on June 24. He allegedly swindled investors out of millions by convincing them his Vatican ties gave him first dibs on flipping Catholic Church properties.

Follieri's lawyer, Flora Edwards, expressed surprise upon learning the prosecutor had mentioned plea talks.

"I'm certainly not saying that, and I'm not sure it's appropriate," Edwards said, adding that the only thing she'd agreed to was an extension of time for Follieri's next appearance in Manhattan federal court.

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