Didn’t the Fed bail these suckers out?

Seems a couple of the executives at Bear Stearns got arrested Thursday. Matthew Tannin and Ralph Cioffi are not happy campers..or happy hedge fund operators. From the Marketwatch link:

They were charged in a nine-count indictment that alleged the two engaged in wire fraud, conspiracy and securities fraud in misleading investors about the rapidly tanking value of the two funds.

Ah..so it was only misleading the investors..no big deal..folks do it all the time, ala Enron, right? Only the bigtime Exec’s go to jail.

Well the Justice Department is making it a big deal, along with mortgage fraud..arresting hundreds possibly. Four, count em, four hundred of these folks were recently indicted. Said Deputy Attorney General Mark Filip about the indictments of all these real estate/securities folks:

“Mortgage fraud and related securities fraud pose a significant threat to our economy, to the stability of our nation’s housing market and to the peace of mind to millions of Americans,”

Mortgage fraud, as you can imagine..is up substantially in the past twelve months. From the MSNBC link:

The most common type of mortgage fraud was misstatement of income or assets, followed by forged documents, inflated appraisals and misrepresentation of a buyer’s intent to occupy a property as a primary residence.

Somehow, I think this is just the tip of the iceberg..and yes, it probably will get a whole lot uglier.

H/T to John Amato at C&L for the 411 on this interesting development.