U.S. prosecutors are preparing to file criminal charges against managers of two Bear Stearns hedge funds whose collapse helped kick off the credit crisis last year, the Wall Street Journal reported on Monday, according to Reuters. For those who remember the day to day events of last year the subprime markets was failing before the funds collapsed. Banks specializing in subprime, such as HSBC’s subsidiary HSBC Finance, has already announced major losses. But who cares about the exact timing – this is a major announcement as responsibility may have a high price.
Any indictments would be the first major criminal charges brought against Wall Street executives or fund managers stemming from the subprime mortgage crisis.