The financial world remains abuzz over the latest twist and turns in the insider-trading case involving Galleon Management co-founder Raj Rajaratnam. At the same time, too little attention is being paid to the criminal trial of two former Bear Stearns hedge fund managers.

The trial of Ralph Cioffi and Matthew Tannin began in federal court in Brooklyn the same week that Rajaratnam and five others were charged. But it’s the Bear trial that may have a far more lasting impact on the future of securities fraud prosecutions.

That’s because if the government’s lawyers can’t convince the jury that Cioffi and Tannin lied to their investors about the financial stability of those once giant hedge funds, other federal prosecutors may get the chills.

Acquittals of Cioffi and Tannin could cause prosecutors to shy away from filing future cases stemming from the financial crisis, in particular the wreckage of American International Group and Lehman Brothers.

And here’s the thing: It’s looking increasingly likely that Cioffi and Tannin may walk. The prosecution’s case has been hampered by rulings by Judge Frederic Block that has kept the jury from hearing about some potentially damaging emails the pair sent. Some uneven testimony from the prosecution’s own witnesses also hasn’t helped.

Cioffi and Tannin were the first prominent Wall Street executives to face criminal charges arising from the worst financial crisis since the 1930s. And there was some rough justice to that ignominious honor, since one can peg the start of the crisis to the July 2007 collapse of the one-time $30 billion Bear funds, which choked to death on exotic securities backed by subprime mortgages.

More than two years later, few expected that Cioffi and Tannin would still be the only high-level Wall Street executives facing the possibility of time behind bars.

The wheels of justice are moving particularly slowly when it comes to AIG and Lehman in part because the events leading to their collapse are complex and hard to explain. And many of the executives at AIG and Lehman drank the same Kool-Aid everyone on Wall Street was serving about the impossibility of the entire U.S. housing market collapsing at the same time.

It’s not a crime to be stupid and wrong.

Rather, it takes hard proof — emails, witness testimony and other documents — to show that executives within big firms like AIG and Lehman knew the exotic securities they were selling were built on a house of cards, and the models they relied on to justify those transactions were fundamentally flawed.

But that kind of proof, as the Bear trial is showing, can be hard to come by and often not as convincing when it gets to a jury.

That’s one reason why prosecutors love big insider-trading cases like the one against Rajaratnam — they are easier to prove. Once a prosecutor can demonstrate that a trader got top-secret information, proving the person traded on that confidential information is the easy part. It’s no sweat for prosecutors to get access to a hedge fund’s trading records when wrongdoing is suspected.

In the end, it may not be the alleged lies to investors that trip up Cioffi. What may get him is the charge he engaged in insider trading by moving some $2 million of his money out of the troubled funds and into another, smaller and more stable Bear hedge fund.

When Cioffi was indicted, many legal experts thought the insider trading charge was the weakest one because Cioffi still left some $4 million of his money in his ailing funds. And he lost that money when the funds went down.

But if it’s the insider trading charge — as flimsy as it may be — that ultimately gets Cioffi, look for federal prosecutors to bring a rash of cases that look like copycats of the Galleon investigation. And as for those more compelling lying-to-investor cases — well, not so much.