BEAR MANAGER MAY HAVE HEDGED HIMSELF

A former Bear Stearns hedge fund manager who is being scrutinized for having pulled out up to $2 million from a troubled hedge fund, might have done so while at the same time telling investors in the fund to hold tight.

According to a senior Bear executive, Ralph Cioffi, along with another Bear executive, Matthew Tannin, in April began having conversations with investors asking them to delay or halt withdrawals from two hedge funds that ultimately imploded over the summer due to bad bets on subprime mortgages.

The withdrawal requests began coming in February, lawyers for several former clients told The Post.

Cioffi’s $2 million withdrawal is being investigated by US prosecutors looking into the collapse of the two hedge funds amid questions about whether the manager improperly took funds out despite offering bullish outlooks on their performance. The Wall Street Journal first reported the Cioffi probe yesterday.

In July, the two Cioffi-managed hedge funds collapsed, taking up to $1.6 billion in investor capital with them and helping to usher in a tumultuous period for the credit markets.

In Cioffi’s defense, he left $4 million of his money in the funds.

Also, the $2 million he did withdraw was put into a smaller – and less-troubled – Bear hedge fund, the $228 million Bear Stearns Structured Risk Partners fund, according to BusinessWeek.com.

Over the past three weeks, Cioffi and his legal team had been in heated negotiations with Bear Stearns over the terms of his departure, and as of a week ago, Cioffi had managed to secure the vesting of a large block of previously restricted stock.

Until this most recent twist in the saga, Cioffi had been attempting to put together a $250 million multi-strategy fund centered on investments in the battered mortgage market. roddy.boyd@nypost.com