The Wall Street trial of the century (and a horrendously botched prosecution) has led to the acquittal of two former Bear Stearns hedge fund managers accused of defrauding investors.
It took a jury less than two days to exonerate Ralph Cioffi and Matthew Tannin of securities and wire fraud. Cioffi was also accused of insider-trading. The two were accused of lying to investors in their two hedge funds, painting a rosy picture while the bottom fell out of the credit market. Both funds failed, costing investors $1.6 billion.
Their victory is a huge defeat for the Justice Dept., serving as something of a test case for similar battles against Wall Street executives.
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- Use the Bloomberg command
NH BLG_DEALBREAKER <GO>
to access Dealbreaker
Wow, I mean WOW!
commonsense prevails…… these guys were idiots but no more than JMW and he is raising a new fund!!
@16 from previous thread
BS – these guys will easily be at work in months…for one thing, most folks on the industry are aware that such a case could be made against any salesperson
yeah the Govt really gets the job done. i cant wait for helathcare.
Now imagine these prosecutors were doctors operating on your mamma…
Change you can believe in.
Haha DOJ.So now there is no credible threat of prosection for securities fraud?(God knows the SEC cant try anything) Lol. Where can I sign up to get my Series 7?
-Crappy Lawyer
“Our investments are toast.” Hey, I didn’t mean that in a bad way. I love toast! I often have it for breakfast.
The angle here Jon is that I was the first to report that the Gov’t was botching the case. That was last week even.
-CG
@4 why would you have a lawyer operate on you? and what is “helathcare”?
@9 Take your dick out of Obama’s ass. i cant be any clearer to you.
gfym
-4
CNBC was DOJ-esque in their botching of the verdict.
Think the defense team is going to need a fancy new website! What a joke. Bernie pled guilty, right?
ralph fools them yet again…
2nd @3/SBII (FML, but when you’re right, you’re right)
Does everyone assume Cioffi is guilty just because his name ends in a vowel?
see, all it takes is the “pathological liar” or “eternal optimist” defense to overpower the DoJ!
@3 interesting, it just seems like there are many other people out there to hire that are less tainted.
you all realize the folks on the jury were all out of work bankers (no excuse not to show up)…what verdict did you expect?
@9- And then take Michelle’s dick out of YOUR ass.
Not 4 or 10
@15 – yes.
Tribe Member
I couldn’t be happier for Ralph Cioffi and his family. He’s an honest guy who was faced with an extraordinary set of circumstances in 2007. They are guilty of employing too much leverage, but not of criminal misconduct. How does one soothe investors when the credit markets are falling apart?
Torches and pitchforks, comin’ at ya!
@21 Wasn’t he pulling his own funds out at exactly the same time?
@21 are you joking or retarded?
shazzums, can we get some sirens up in this b1tch? please…
@21
If you considering trying to buy condos in south florida “pulling his money out” (to put it in something just as bad?), maybe.
Prosecutor Benton Campbell- bachelor’s degree from Yale University and his law degree from the University of Chicago Law School.
looks like someone didn’t pay attention in class.
And I am the first to report that Stevie C will be acquitted as well.
Q.E.D.
SHAM-WOW!
How sad; how fu*king sad.
So much for TGFD’s theory about Main Street’s anger. Fu*k the idiots in the jury. Let them eat their own foreclosed mortgage papers when their enemployment checks run out.
The deserve nothing less.
The Guy from Delaware
FUCK!!!! I SHOULD HAVE GONE TO TRIAL!!!!!!!!!
-B. Madoff
Is it harder to get a job with GS or SAC?
I have no plans to let either of these folks manage any of my money, but making a sales pitch for something that turns out to be a bad investment is not/should not be a crime. They deserve humiliation for losing that much money but not jailtime. If we start throwing people in jail for not realizing in advance that the subprime market would collapse, then there wouldn’t be too many people walking free
@28 does it really matter whatever may or may not have happened more than 5 (five) years ago?
Let’s let the past be the past.
Not innocent but definitely not guilty.
@33 Cramer is that you? You dont think these 2 clowns should be held accountable for telling clients something they new to be false subsequently losing them over a billion bucks? Umm hey pal news alert OJ did it.
Just because the inept govt couldn’t prove it doesnt mean OJ was over there carving a turkey.
I hope you lose all your govt cheese.
Learned, I still hate you.
It is finally a day in which I can celebrate!
FREE(D) CIOFFI!!!!! HAHAHHAHAHAHHAHAHHAHAHHA SUCK IT DOJ. SUCK IT!
-mrp
*popping a bottle of bubbly now because the Cioffi is Back. In. Da. Game. yessssss!
“You’re doin a fine job, Brownie. I mean Eric!”
@37 – That’s because mother always liked me best.
- L.H.
Glad the guys got off, but they did commit fraud, just not the one which was prosecuted. They lied in their disclosures about how much subprime they had, putting it purposefully in the ABS bucket. All of this is captured in Cohan’s House of Cards, btw.
Dane Butswinkas gets the last laugh bitches!
The Blankfein is pleased, very pleased.
LB
I hear Lenny D is looking to raise some capital for his new fund. Cioffi might be the guy for it!
This was the right decision. The power-hungry trolls who work for the government have long been trying to criminalize bad decisions in order to get headlines and career advancement for themselves. But bad decisions are mistakes, not criminal conduct.
The real crime is prosecutorial misconduct by the DOJ and SEC. They cannot stop real criminals (Madoff) so they often trump up charges against people they view was weak.
This case should never have even gone to trial, but the jury did the right thing.
And, after all, hedge fund investors are “sophisticated investors” who understand they are at risk of losing their entire investment. They lost their money, too bad for them, why waste my tax dollars trying to pin blame.
Does anyone get anymore there’s a diff between civil liability and criminal acts? You screw up your fiduciary duty, let your investors sue your ass. Very different than criminality, which IMHO, the government never demonstrated in this case.
This is the only rational outcome.
-Evil Banker
@46 – STOP IT!! You and your fucking “logic” and “facts”. Criminal, Civil, it’s all the same thing as LONG AS THESE THIEVING BASTARDS GO TO JAIL AND WE FEEL BETTER.
This decision does NOT mollify the Torches and Pitchfork crowd!
Williams and Connolly represented these guys. Arguably the best litigation firm in the country. Goes to show what good lawyering can do–these guys would have been (should have been?) behind bars had most anyone else represented them. And Tax Chick and guest–nice use of Learned Hand (yeah, I’m a nerd …).
– Finance attorney with great admiration for W&C
Madoff is starting to look like a f*ing idiot for pleading guilty. Stupid.
Madoff is starting to look like a f*ing idiot for pleading guilty. Stupid.
Madoff is starting to look like a f*ing idiot for pleading guilty. Stupid.
@50/51/52 – you’re starting to look stupid for the triple post…stop it greg!
This is the hand of God at work.
“,,,yeah the Govt really gets the job done. i cant wait for helathcare.
Now imagine these prosecutors were doctors operating on your mamma…”
Excellent point @4. You should sign up to have the private sector bankers at Bear and Lehman operate on your mamma. Sounds like she deserves it raising a rocket scientist such as yourself.
Breathing easier (although my armpits did stink).
Zvi
There’s one (thousands) born every minute!
@49,
FINALLY, someone used the “if they had $h!tty lawyers, then they would have lost” argument. I was worried that all we were going to get was populist outrage…
Nice to have a friendly judge too (see Judge Skinner in a Civil Action). Cioffi the St Michael’s College grad (come on!) was born with a silver horseshoue wedged tightly in his ass.
So, what *will* it take for a banker to be prosecuted?
Amateurs.
-J. Costas
I haven’t followed this closely. Other than not having a case, what did the prosecution do that was so bad?
http://blogs.wooeb.com/EQUITIESMAGAZINE/Post.aspx?postID=62587
The prosecutors must have been clueless. I worked at BSAM and it was widely known that the returns on these funds were complete mark-to-myth fiction. The hedge fund salespeople even joked about it. Of course any investor that really believed that these funds went years with out a down month probably deserves what they got.
The real criminals were BSAM management, especially the CIO and CEO, Rich Marin, who knew about all sorts of fraudulent activity in the Cioffi and other BSAM funds.
@64 no fucking shit the prosecutors were clueless.
in related news, Bank of America now has two solid candidates for the top spot
trb
@64
If what you say is indeed true – why did you bury your head in your ass instead of stepping up and say something?
Not Guilty, the filty…devils tried to kill me…
Darn those competent white-collar defense counsel! Darn them to heck!
This country has incompetence in every other field of endeavor (including asset management, naturally) — why can’t we get some incompetence when we need it among defense counsel????
you idiots actually think that they were merely salesmen pitching a crappy product? no, they RAN the 2 funds and were busy giving investors fraudulent financials of the funds. grossly understating the amount of sub prime assets in your phone is illegal. what a joke that we have to rely on moe, larry and curly to prosecute these guys.
For those who think the Bear Stearns acquittals mean that Madoff should be sorry he pleaded guilty because he might have won the same had he gone to trial: you know, it’s kinda tough to go back from confessing to the FBI. I’m sure it’s been done, but, you know, tough.
@60/main street
not everyone in finance is a banker, despite Maxine’s claims to the contrary. Your Ameriprise broker can explain this, maybe.
If there weren’t trying to sell you shit, you must acquit.
2FT2lZ Very neat blog post.Really thank you! Keep writing.