Tuesday, 21 February 2017
Last updated 15 min ago
Sep 12 2011 | 12:29pm ET
More than two years after triumphing over federal prosecutors, two former Bear Stearns hedge fund managers will be back in court to fight a Securities and Exchange Commission lawsuit.
A federal judge in Brooklyn, N.Y., scheduled the civil trial of Ralph Cioffi and Matthew Tannin for Feb. 13. The SEC lawsuit, filed at the same time as their criminal indictment, accuses the two men of misleading investors about the financial health of their two hedge funds, the Bear Stearns High-Grade Structured Credit Fund and a more highly-levered sister fund. Their collapse more than four years ago cost investors some $1.6 billion and contributed to the eventual collapse of Bear itself.
The SEC had pledged shortly after the acquittal of Cioffi and Tannin that it would move forward with its case, which has a lower standard of proof. Jurors in the criminal case said after that trial that they believed that Cioffi and Tannin had been working furiously to save the fund.
During a conference on Friday, a lawyer for the SEC told U.S. District Judge Frederic Block that the two sides have had "no discussions of substance" about settling the charges.