Lessons from Bear Stearns indictments? Don’t trust anybody or anything.

I have to disagree with WSJ Lawblogger Dan Slater’s takeaway from the Bear Stearns indictments. Dan wrote, late Friday afternoon:

Yesterday, as we broke down the Bear Stearns fund-manager indictment, one thing stood out to us as clear, and poignant (presuming for the sake of this post that the allegations in the indictment are true): It seemed Matthew Tannin was vexed inside by competing voices. . .

The NYT reported today that Tannin was known within his group as a worrier. Again, presuming the government’s allegations to be true, perhaps Tannin should have trusted, and acted upon, his worries, his instincts. Instead, the indictment alleges, he didn’t.

These two paragraphs don’t seem to go together. I agree that the material in the indictment suggests Tannin was “vexed inside by competing voices” or some such thing. But this, to me, does not translate to “Tannin didn’t trust his instincts.” In fact, I read just the opposite in the indictment: Tannin did trust his instincts and he trusted the people he worked with, especially Ralph Cioffi. And that trust was what got him into trouble. Continue reading