* Evidence could confuse jury, Cioffi's lawyers say

* Government also alleging fraud

* Judge expected to rule before October trial

By Jonathan Stempel

NEW YORK, Sept 2 (Reuters) - A former Bear Stearns Cos hedge fund manager accused of insider trading urged a federal judge to reject evidence suggesting he improperly tried to use money as collateral to build a condominium and repeatedly ignored conflict-of-interest rules on in-house trades.

The request was submitted Tuesday to the Brooklyn, New York, federal court by lawyers representing Ralph Cioffi, who along with former colleague Matthew Tannin faces multiple criminal fraud charges over the 2007 failure of two hedge funds.

That failure cost investors $1.4 billion and helped trigger the global credit crisis and eventual sale of Bear to JPMorgan Chase & Co (JPM.N: Quote, Profile, Research).

Cioffi's lawyers said it would be "unduly prejudicial" to show their client tried to pledge $2 million of his stake in one Bear fund as collateral for a Sarasota, Florida, luxury condominium he was building with his brother.

They said several top Bear asset management officials knew of and did not object to the proposed pledge, negating the government's contention that "in all likelihood" the officials would have vetoed the pledge.