Lisa Chow is the economics reporter at WNYC. She tries to explore in her stories surprising aspects of New York’s many economies—in plain view or hidden, in neighborhoods or sectors.
Trial of Former Bear Sterns Hedge Fund Managers Continues
Friday, October 16, 2009
New York, NY —
Opening statements continued yesterday in Brooklyn, in a trial of two former Bear Stearns hedge funds managers. The men are the first Wall Street executives to be criminally charged in a case stemming from the subprime mortgage crisis. Their hedge funds collapsed before Bear Stearns failed in 2008. WNYC's Lisa Chow has this update on their trial.
REPORTER: The government is accusing the two managers, Ralph Cioffi and Matt Tannin, of lying to investors, and misleading them about the health of their funds, whose collapse resulted in $1.6 billion dollars in losses.
Tannin's lawyer tried to portray the 48 year old as an "anxious" person, who consistently went to his boss, Cioffi, to understand the investment strategy.
She said Tannin's job was a marketing job - to make the case for investing in the funds, and to keep investors happy. And she argued that he wasn't misleading investors because as he was expressing confidence to them, he was also expressing confidence about the funds' future performance to his colleagues.
If convicted, both men could face up to 20 years in prison. For WNYC, I'm Lisa Chow.