http://www.bloomberg.com/apps/news?pid=20601087&sid=aefVn_KahdBI&refer=home

Bear Stearns Cos. former hedge fund managers Ralph Cioffi and Matthew Tannin were taken into custody at their homes this morning over their roles in the collapse of two funds that ignited the subprime mortgage crisis last year.

The arrests are the first from a federal probe of possible fraud by banks and mortgage firms whose investments in subprime loans and securities plunged in value, causing losses that now total $396.6 billion. The Securities and Exchange Commission may sue the two men as early as today, claiming they committed fraud by falsely telling investors the funds they managed were in good condition, people with knowledge of the case said.

...

``The floodgates could open,'' he said.

More than 400 people have been charged in a separate U.S. Justice Department mortgage-fraud sweep, two law enforcement officials said today.

It would be nice to see some people go down hard for this mess. I'm not one to blame the financiers for consumers making stupid choices, but these guys knew that their funds were basically scams and definitely deserve consequences for that.

Six months from now... In court proceeding in Manhatten federal court 3 file cabinet workers for Bear Stearns have had warrants issued for their arrests in the mortgage meltdown crisis. It appears that they were purposely negligent in how they had placed files within file folders before filing them in filing cabinets.

The filers, who are on a work release program from the Brooklyn mental retardation center have been charged with federal crimes of intentionally manipulating the mortgage market in order to keep their jobs with Bear Stearns. They had previously been slated to be laid off in cost cutting measures that allow Bear Stearns to now hire illegal aliens, under the recent law changes on a presidential decree, known as the yermyfriendsoimakelawsforyou act.

"These employees have obviously done their best to lay the blame at the feet of the Bear Stearns executives that had been previously charged" Said an attorney for the Bear Stearns Executive Defense Fund


January 2009...

President George Bush has issued pardons for Bear Stearns Executives accused in mortgage fraud.

Please Jesus, death penalty.

More!

http://www.boston.com/news/nation/washington/articles/2008/06/19/hundreds_swept_up_in_mortgage_fraud_arrests/

Ever expanding!

http://money.cnn.com/2008/06/19/real_estate/mortgage_fraud/index.htm

(and good. fuck 'em)