Margaret Paterson, 62, was jailed for five years in 2013 after a trial at the High Court in Edinburgh.
The madam was convicted of brothel-keeping, money laundering and living off the earnings of prostitution, with the offences aggravated by a connection with serious organised crime.
Paterson’s affluent lifestyle came to an end after police raided business and brothel premises in Grosvenor Street in Edinburgh’s West End in September 2011.
Officers found sex toys, 100 boxes of unused designer shoes, a seven feet pile of about 400 designer handbags and evidence of a spending spree in some of the capital’s most exclusive shops.
Credit cards detailing purchases from Harvey Nichols, Louis Vuitton and Mulberry were recovered.
Paterson, dubbed Madam Moneybags, was also discovered to have more than £200,000 in cash in her west end home. Jewellery was also found.
Paterson, who was also convicted of aiding and abetting prostitution, was found guilty of laundering more than £1.2 million, more than £500,000 of which was carried out with her business partner Robert Munro.
The Crown brought an action to seize any crime profits from Paterson and a judge was told today that a settlement had been reached in the case.
Defence counsel Mark Moir said under its terms it was agreed that the benefit from her particular crime was £1 million and a confiscation order should be made for the same amount.
Lord Boyd of Duncansby said he would record the benefit at £1 million and make an order confiscating the same amount and gave her six months to make payment.
Paterson’s assets included a property portfolio in Edinburgh, bank accounts, handbags, shoes and jewellery including designer makes like Prada and cash seized of £210,571.
Her former co-accused Robert Munro also appeared in the dock along with Paterson to settle a proceeds of crime action brought against him.
His counsel, Tony Lenahan, said under its terms it was accepted that the benefit from his criminal conduct was £544,601 and that a confiscation order should be made in the sum of £96,836.
Advocate depute Barry Divers told the court that the amount of the figure for the confiscation order in Munro’s case represented his “realisable assets”.
His assets included bank accounts and premium bonds. Both Paterson and Munro were said to have a half share each in 2A Grosvenor Square, Edinburgh.
Munro, 63, a talented bagpipe player who plans to return to playing Scottish music on his release, was also jailed for five years for his role in the seedy venture which exploited vulnerable women, often young single parents in dire financial straits.
The pair ran a brothel and escort service which provided prostitutes all over Scotland.
The judge who jailed them, Michael O’Grady QC, said: “It has been an operation remarkable in its scope, sophistication and organisation, not to mention profitability. It has also been remarkable for its cynicism.”
Paterson and Munro were later made the subject of financial reporting orders by the courts which require them to provide details of assets, income and expenditure during an eight-year period in only the second case of its kind in Scotland.
The pair were said to have carried out “a clearly business-like and well-organised, albeit, criminal enterprise”. Paterson entered into a partnership with Munro to run their business interests in 2002.
Following their convictions for offences arising from the sex trade the Crown began proceedings against them to seize any profits made through crime.
Munro was also given six months to make payment of the £96,836 confiscation order made against him.