Saturday, 25 April 2015
Last updated 20 hours ago
Sep 4 2013 | 12:27pm ET
A federal judge has dismissed a lawsuit against two former Bear Stearns hedge fund managers, six years after their funds' collapse in the early days of the credit crisis.
U.S. District Judge Alison Nathan in Manhattan threw out Bank of America's lawsuit against Ralph Cioffi and Matthew Tannin, as well as another former Bear portfolio manager, Raymond McGarrigal, and JPMorgan Chase, which bought the failing Bear in 2008. BofA alleged that the defendants had misled them about the health of the hedge funds, with which it had entered into a $4 billion securitization deal known as a collateralized debt obligation-squared. BofA said it would have never had entered that arrangement if it new the truth.
Due to Cioffi and Tannin's lies, including about redemptions requests, BofA was socked with billions in losses when the funds imploded in 2007, it alleged. But Nathan ruled that the bank had not proven any damages tied to Cioffi and Tannin's conduct and that no rational jury would find for it on any counts. For good measure, Nathan called one of BofA's experts "inherently unreliable."
The dismissal is only the latest judicial victory for Cioffi and Tannin, two of the only people criminally charged in a case related to the financial crisis. The two men beat those fraud charges, and last year settled a Securities and Exchange Commission lawsuit for about $1 million, which the judge presiding over that case called "chump change."
The failure of the High-Grade Structured Credit Fund and a more highly-levered sister fund cost investors $1.6 billion and helped lead to Bear's own collapse. BofA had been seeking more than $2 billion.
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…