Bear Stearns managers indicted; emails could be smoking gun - MarketWatch

Obviously many have been watching the recent arrests of former Bear hedge fund managers Matthew Tannin and Ralph Cioffi. My first reaction was that they were being made scape goats so I was somewhat surprised when I saw this article that suggests there may be a case.

Bear Stearns managers indicted; emails could be smoking gun - MarketWatch:

"'If we believe the [collateralized-debt obligation report] is anywhere close to accurate I think we should close the funds now,' wrote Tannin, according to the indictment. 'The reason for this is that if [the CDO report] is correct then the entire subprime market is toast. If AAA bonds are systematically downgraded then there is simply no way for us to make money -- ever. ... Caution would lead us to conclude the [CDO report] is right -- and we're in bad bad shape.'

But Tannin, Cioffi and other high-ranking Bear Stearns executives met with investors April 25 and assured them the funds had plenty of liquidity to survive any upcoming pressure."

Ouch. But is this just speculation? The whole thing is conditioned n an "if". Maybe they concluded that things were not as bad as suspected prior to the April 25th meeting? Would not want to be a juror on this one, it could go a while. Stay tuned.