Two former Bear Stearns hedge fund managers were on Thursday indicted on federal charges that they intentionally misled investors about the financial condition of the investment vehicles that collapsed last year.

In an indictment unsealed on Thursday, Ralph Cioffi and Matthew Tannin, who ran two high-profile hedge funds for Bear, were accused of telling investors that the funds were an “awesome opportunity” and of attempting to attract more money into the funds even as they were privately discussing concerns about the funds’ prospects. Mr Cioffi also allegedly transferred about $2m of his own investment from one of the funds into another fund and did not tell investors.