Prosecutors seemed very much in a rush in the Bear Stearns case, for they were demanding to interview witnesses at nine o’clock at night, according to a lawyer involved in the case.

“That was prosecution that was brought in great haste, and I worry about that,” says John Carroll, who as an assistant U.S. attorney led the case against Michael Milken.  He has recently joined Skadden, Arps, Slate, Meagher & Flom, where he and David Zornow, who also worked in the U.S. attorney's office in Manhattan, are now reunited on the defense side.

The process of sifting through the evidence should take months if not years, but the public appetite for blame is much more impatient than that,  Carroll says.

The June 19 charges in the Bear Stearns case show Tannin complaining in an email that to Cioffi “we are in bad bad shape” and that the “subprime market looks pretty damn ugly,” while cautioning his boss against disclosing anything that could hint at the extent of the funds’ troubles. Days later, in an April 25, 2007 conference call with investors, Tannin sang a different tune, noting, “we’re very comfortable with where we are.” Also on the call, Cioffi ducked the question of whether there had been large redemptions from the funds, failing to mention that a redemption of about $57 million had been made just days before the call.

Prosecutors had suggested that a grand jury would hand up a superseding indictment, but at a pretrial conference on December 5, they added no new charges. A trial has been set tentatively for next September. And it is, to the mind of defense lawyers, the simplest case to make.

 “Valuation cases, to my mind, are the toughest cases to make,” Zornow of Skadden says, who noted that the Bear Stearns case eschewed that problem: “They are charging, they knew X, but they told the public Y.”

Will that be enough to win a conviction?  There is a fine line between trying to seem positive and being deceptive. Surely, lawyers for Richard Fuld, Lehman’s former chief executive, last seen in public scowling before a congressional committee and debating whether his compensation has amounted to $430 million or $300 million in recent years, must be contemplating this question.

Fuld’s compensation would figure into motive, as prosecutors try to explain that  “the pressure was to present as rosy a picture as possible,” Professor Henning says. “As the C.E.O. of a company, do you have to come out and say, ‘We are dead?’ You are allowed to put a positive spin on the news, but when do you cross over from spin to fraud?”

That question may be answered in the months and years to come if Fuld and others are put on the spot for the financial turmoil.  But the law puts a heavy burden of proof on the prosecution.

“For a criminal prosecution, it has to be willful,” says Jill Fisch, a professor of securities regulation and litigation at the University of Pennsylvania Law School. “What does willful mean? It means you knew you were materially mischaracterizing. You have to cross that line.”

With so many cases of poor judgment by financial executives proving that the line was crossed will be difficult to prove. “It looks less like greed and more like horrible mistakes in judgment. And the problem is that is much harder to prosecute criminally,” Fisch says.

There will certainly be prosecutions of fraudulent mortgage originators and brokers, but those nickel and dime prosecutions will do nothing to quench the public appetite for an Enron-like case.

 “There will be a lot of investigations, and there may not be many successful cases made,” Giuffra of Sullivan & Cromwell says. “Extreme and unprecedented market forces caused massive losses. These would be classic ‘fraud by hindsight’ cases if they were brought. If they knew it was toxic, why didn’t they just short the market?”

Both Bernard Madoff, who has admitted to  $50 billion Ponzi scheme, creating the basis for his arrest, and Marc Drier, a law firm chief with a gift for impersonation and a drawer full of cell phones at his fingertips, have recently given prosecutors fish in a barrel by comparison.

Bigger Wall Street fish will be much harder to catch.

There may not be any point to the pursuit. John Carroll  says: “Most white-collar crime is good people who are like gamblers at Atlantic City. They lose a hand and they double and they double and the double. And so mistaken decisions turn into bad decisions and really bad decisions.”

Michael Garcia, who was at the center of many of the financial investigations, as United States attorney in Manhattan until November, says "If anything comes out of this, it is going to be a long haul, to  unravel this is going to take a long time—a year or two years." 

And this time around, the cases are spread around the country,  and many of the offices conducting investigations "do not have the  size or experience" to at many federal prosecutors offices that do  not have the size or experience of the Southern District, says Garcia, now in private practice at Kirkland & Ellis. 

And while prosecutors send out a rash of subpoenas and collect  information, the public appetite for blame has not abated. "Some people  are getting a bit hysterical," he says.