MarketWatch- Secretary of the Commonwealth of Massachusetts William Galvin has charged Bear Stearns Cos. with improper trading with two in-house hedge funds that blew up this summer as a result of bad bets on subprime mortgages and other investments.
Investors in the two funds, Bear Stearns High-Grade Structured Credit Strategies and Enhanced Leverage, were exposed to more conflicts of interest than investors in most other hedge funds, according to the compliant.
In early October, press reports surfaced that the U.S. attorney in Brooklyn had started a criminal investigation into the collapse of the Bear Stearns hedge funds.
