2 ex-Bear Stearns fund managers arrested 

June 19, 2008 09:12AM

Two former Bear Stearns fund managers have been arrested over charges of misleading investors about the risks of the subprime mortgage market, federal authorities said. Ralph R. Cioffi and Matthew Tanin are ex-managers of hedge funds that had more than $20 billion in assets before collapsing in June 2007collapsed last year. The pair have already have been named in lawsuits filed last year by investors, including Barclays Bank, who claim that they were misled. Barclays claimed that Bear Stearns managers “hatched a plan to make more money for themselves” and to use a fund “as a repository for risky, poor-quality investments.” Last month, Bear Stearns’ shareholders approved JPMorgan Chase’s $2.2 billion buyout at a firesale price of about $10 a share. In January 2007, Bear Stearns had traded at $171 a share. The FBI announced that it has arrested about 300 real estate-related professionals since March.

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