Saturday, 25 April 2015
Last updated 1 day ago
Aug 2 2007 | 8:16am ET
Bear Stearns CEO James Cayne, who’s probably not sleeping well to begin with, must dread waking up each morning, as each new day seems to bring more bad news to his embattled firm.
On Monday, the firm halted redemptions in a third hedge fund that had been overwhelmed by investors who wanted out. Late Tuesday, Bear’s bêtes noire, its two collapsed credit hedge funds, struck again, declaring bankruptcy. And yesterday, it was hit by the first of what could be many claims against it.
A 73-year-old retired insurance salesman from Wisconsin filed an arbitration claim with the National Association of Securities Dealers against both Bear and Bear Stearns Asset Management, alleging that Bear misled investors about the High-Grade Structured Credit Strategies Fund’s sub-prime exposure. The investor reportedly lost $500,000.
Lawyer Jacob Zamansky, who along with Ross Intelisano—an attorney who represented a group of Bayou Management investors—filed the claim stating his firm has been contacted by a number of other Bear investors and will almost certainly file further claims.
“We expect to file claims in excess of $100 million in losses,” he told Reuters.
Zamansky explained that his client filed an arbitration claim, rather than suing Bear in court, because it “is quicker and cost efficient.”
Meanwhile, both the High-Grade Structured Credit Strategies Fund and its slightly more disastrous sister fund, the High-Grade Structured Credit Strategies Enhanced Leverage Fund, have filed for Chapter 15 bankruptcy, seeking to prevent creditors from further asset seizures. The move was reportedly precipitated by the funds’ inability to meet a margin call.
In addition, the funds’ liquidators, Simon Lovell Clayton Whicker and Kristen Beighton of the Cayman Islands, have secured a restraining order preventing any more asset seizures. There will be a preliminary injunction hearing on Aug. 9 in U.S. Bankruptcy Court in New York.
Mar 20 2015 | 12:45pm ET
StreetWise Partners, a non-profit organization that works with low-income individuals to help them overcome employment barriers, raised over $275,000 at the 2015 Raising the Ante Charity Poker Tournament and Casino Event last Wednesday evening at Capitale. Here are some photos from the event. Read more…