Ralph Cioffi and Matthew Tannin, the former Bear Stearns execs charged with conspiracy, securities fraud and wire fraud in connection with the collapse of the two hedge funds they managed, were acquitted on all counts in federal court this afternoon. So much for the "first major test of a U.S. effort to obtain convictions tied to the subprime mortgage crisis and subsequent recession"! [Reuters]
Bear Stearns execs Ralph Cioffi and Matthew Tannin were led off in handcuffs a couple of weeks ago, accused of deceiving investors in one of the firm's ill-fated hedge funds. Bayou Group founder Samuel Israel III turned himself in last week after spending a few weeks on the run, and has started a 20-year sentence for defrauding investors of $450 million. (He now faces an additional 10 years for bail-jumping.) Plenty of other financial big wigs may ultimately get caught up in criminal probes, making 2008 one of the busiest years for white-collar defense lawyers, at least since the Drexel Burnham boys headed to the clink in the early '90s. A word of caution, though, to high-finance criminals facing the prospect of time behind bars. You do not want to show up to prison totally unprepared a la Sherman McCoy in Bonfire of the Vanities. Certain matters should be taken into account before you head off to the clink. There are even ways to parlay your riches and master-of-the-universe shtick into preferential treatment! Tips for disgraced Wall Streeters on how to survive behind bars after the jump.
Remember Jeffrey Epstein, the "billionaire" financier and Bill Clinton pal who was busted in 2006 for his sexual relationships with underage girls? Two bits of news about the secretive mogul came to light today. First off, it turns out he was an investor in the ill-fated and scandal-plagued Bear Stearns hedge fund managed by Ralph Cioffi and Matthew Tannin. It seems poor Jeff lost a bundle when the fund imploded last summer—some $57 million. Even worse, though, is that today marks the day when he is expected to turn himself in to the police in Palm Beach and immediately begin serving an 18-month sentence for soliciting an underage prostitute. (Where, we're guessing, he won't be able to waltz around in a "JEE" monogrammed fleece as he is on the left.) As awful as that all is, we can't help but think about what a crappy month it's been for Epstein's former pal, Ron Burkle. He now has multiple (former) friends behind bars. And there are a bunch of other people who probably regret ever hooking up with the supermarket billionaire.
And there they go: Ralph Cioffi and Matthew Tannin, the former Bear Stearns hedge fund execs who now face charges of misleading investors, on their way to be fingerprinted before being transported to Brooklyn federal court. Our question: What do you wear when you know the six FBI agents on your doorstep are going to lead you through a gaunlet of reporters on your way to court? We're going to have to hand this one to Cioffi (left) who decided to go business-casual for the occasion. A much more effective way to convey the I'm-relaxed-because-I'm-innocent look, if you ask us.
