A fantastic Barron's [subscription required] interview with Blackrock Inc. (NYSE: BLK) CEO Laurence Fink suggests that the collapse of The Bear Stearns Companies (NYSE: BSC) was aided by hedge funds. But my interview with an industry insider suggests that some hedge funds not only created the collapse, but profited from it through short selling.

Here's an excerpt from the Fink interview:

"The fall of Bear Stearns was a liquidity crisis. It has been rumored that there were hedge funds promoting hostile and negative comments, which accelerated the fear of doing business with Bear Stearns. I believe it would be prudent if the SEC investigated these rumors. Bear Stearns was a very fine institution destroyed by the profiting of a few. In a normalized market, Bear Stearns would have never fallen like this. The rating agencies caused the ultimate fall of Bear Stearns."

This is consistent with what I heard from a Wall Street insider who attended a March 14 speech by President Bush at the Economic Club of New York -- three days before the JPMorgan Chase & Co. (NYSE: JPM) deal to buy Bear at $2 a share. This insider sat at a table next to a New York hedge fund manager and asked him whether he was surprised by the collapse of Bear Stearns. What the hedge fund manager said came as a shock to me: "Bear's collapse didn't surprise me. We've been short Bear for five days. All the hedge funds have been pulling their prime brokerage business from Bear."

CNBC's Charlie Gasparino reported that Laurence Fink, who was offered the Merrill Lynch (NYSE: MER) CEO job, asked Merrill's board for a complete accounting of the subprime problem there before he would agree to accept the position. This request encouraged Merrill's board to "go in a different direction."

If Fink did not like the results of the subprime audit, he could have turned down the position and left Merrill's board in the awkward situation of needing to disclose the truth of the situation. What I find amazing is that Merrill's board needed Fink to drag it into making such an audit. And then it decided that it would rather offer the CEO job to someone else who wouldn't force it to come to grips with its problems.

John Thain is going to have a tough job ahead of him. But Merrill's gain is Citigroup Inc.'s (NYSE: C) loss.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He owns Citigroup stock and has no financial interest in Merrill Lynch.