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Feds allege ex-Bear defendants hid troubles with funds

Two former Bear Stearns portfolio managers for two failed hedge funds indicted on securities and wire fraud charges yesterday, allegedly considered liquidating the troubled funds as early as April last year because of their poor prognosis.

The portfolio managers also allegedly understated the level of investment in the sub-prime mortgage market to investors, and allegedly lied to investors and counterparties about redemptions.

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