It is being reported on CNNMoney.com
Two former Bear Stearns hedge fund managers, Ralph Cioffi and Matthew Tannin, surrendered Thursday to the FBI. The men face federal charges that they intentionally misled investors in two funds that collapsed last summer under the weight of wrong-way bets on mortgage-backed securities.
The case will be determined on what both managers actually knew, when they were advising investors. These are the first arrests to come out of the recent credit crisis. Even if it runs out these two managers acted illegally, Wall Street and the financials should have seen the dangers of the sub prime mortgage industry coming far in advance.
However, as the son of a former mortgage broker who was forced under threat of termination to give out loans that he knew in the long run would be detrimental to his own livelihood and that of his customers; I’m hoping more than a few of the big boys go down.