"Believe it or not - I've been able to convince people to add more money."
An e-mail sent by former hedge fund manager, Matthew Tannin regarding the shaky conditions of the funds
Today, The NY Times features a fascinating article about the Bear Stearns indictment. Two former hedge fund managers at Bear Stearns have been indicted, charged with nine counts of securities, mail and wire fraud. These men are being accused of lying to investors about two hedge funds that were falling in value daily due to securities backed by subprime mortgages and insisting the funds were performing well. "In late April, investors were becoming concerned. One investor tried to pull $57 million. Mr. Cioffi, in a bid to keep the investor in the fund, said that he himself had $8 million invested. The indictment says that was a lie."
How did they think they were going to get away with this?!! It is noted that at one point one of the fund's managers, Ralph Cioffi transferred $2 million of his own money out of one of the plummeting hedge funds. Wow, this sounds a lot like the Enron scandal, and we all know how well that turned out.
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