Prosecutors thought the defence was blowing the case when lawyers for Matthew Tannin and Ralph Cioffi argued that their clients were being made scapegoats for the financial crisis.
The prosecutors thought they had presented a very straight forward case, according to a person familiar with the matter. The case they argued was deceptively simple, the person said. It turned on two points:
- The Bear Stearns hedge fund managers had said that they still had “skin in the game” while they were withdrawing their own money.
- The managers told investors that there were no redemptions when they knew that wasn’t the case.
The prosecutors thought that the defence would fail because it was arguing a larger, political case that didn’t exist. It struck the prosecutors as a desperate attempt at misdirection, the person said. They were confident that the jury would see through this tactic.
This now looks like a dramatic miscalculation on the part of the prosecutors, of course.
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