CNN Money – Ralph Cioffi and Matthew Tannin, both former hedge fund managers at Bear Stearns, are accused of painting a rosy picture of their portfolios, even though “the defendants believed that the funds were in grave condition and at risk of collapse,” according to the prosecution.

Prosecutors blamed Cioffi and Tannin for causing Bear Stearns investors to lose more than $1 billion, alleging that their fraudulent behavior led to the collapse of their hedge funds and, subsequently, Bear Stearns. They have both pleaded not guilty and are out on bail: $4 million for Cioffi and $1.5 million for Tannin.

The trial is scheduled to begin Oct. 13 in U.S. District Court in Brooklyn, New York. Cioffi and Tannin could each face 20 years if convicted of securities fraud.

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Tags: bear-stearns, hedge funds, hedge-fund-managers, prosecution, securities fraud

The Associated Press – A Silicon Valley hedge fund manager wanted in the U.S. on charges he duped investors out of at least $5 million challenged his extradition from Hong Kong on Wednesday.

Fund manager Albert Hu, an American citizen, told a Hong Kong court through his lawyer that he wanted to exercise his right to see evidence in his case, in which U.S. officials are seeking his extradition to California.

"He feels that he must seek evidence (from) the prosecution," said defense counsel Jonathan Acton-Bond.

Hu had indicated he was willing to surrender to the U.S. during his first court appearance last week, according to Hong Kong’s Department of Justice.

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Tags: 5-million, american citizen, court appearance, defense counsel, department of justice, Hedge funds waiting to invest $300 billion: report, hedge-fund-manager, hong kong court, investors, jonathan, jonathan acton, lawyer, prosecution, silicon-valley