Bear Stearns Trial Recap
Ralph Cioffi and Matthew Tannin, the two former Bear Stearns hedge fund managers, apparently won’t testify in their own defense in the first criminal trial related to the mortgage meltdown. Both men are accused of securities fraud, with prosecutors alleging they repeatedly lied to investors about the fiscal health of two hedge funds that collapsed amid the mortgage crisis in the summer of 2007. Investors in the funds lost about $1.5 billion.
Among the allegations against Cioffi is that he lied to investors during a conference call in April 2007. On the call, Cioffi reportedly said that, collectively, investors planned to withdraw a “couple million” dollars from the funds. Prosecutors, however, contend Cioffi made the statement only two days after learning one investor, Concord Management LLC, intended to withdraw $57 million.
Closing arguments in the case will begin Nov. 5. If convicted, Cioffi and Tannin could face up to 20 years in prison.
The case is U.S. v. Cioffi, 08-CR-00415, U.S. District Court, Eastern District of New York (Brooklyn).
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