SSH Proxy problem

Telnet and SSH are two drastically different application protocols... SSH uses a non-SSL based encryption scheme to encrypt traffic between the client and the server; telnet is basically a raw socket.

It would be possible to use something like stunnel on the client, then routing your telnet client through that, but that's still not as good as SSH.

     Client Machine         |                 BigIP Device         | Audit Device      |     Server
----------------------------+--------------------------------------+-------------------+------------------
telnet client --> stunnel --|--> BigIP SSL/TLS virtual (offload) --|--> audit device --|--> telnet server

I'd personally recommend something like SSH, paired with auditd on the server side: http://whmcr.com/2011/10/14/auditd-logging-all-commands/