Friday, 25 July 2014
Last updated 3 hours ago
Jun 27 2008 | 12:32pm ET
Two former Bear Stearns hedge fund managers indicted last week may face additional charges.
Ralph Cioffi and Matthew Tannin have already been accused of misleading investors in their High Grade Structured Credit Fund and its more highly-levered sister offering. Now, federal prosecutors may add allegations that the two misled the banks that lent money to and invested in the funds, which collapsed last summer after being battered by the credit crisis.
Charges could be added to the indictments as early as next week.
Investigators have spoken to Bank of America, Barclays, Merrill Lynch and other banks that had relationships with the two funds. They are especially interested in BofA, which guaranteed and sold $4 billion in collateralized debt obligations last spring.
BofA is reportedly telling authorities that it believes it was misled.
Barring new charges, Cioffi faces 40 years in prison if convicted, and Tannin 20 years.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…