By Troy Racki:After spending 38 months adrift in the turbulent waters of bankruptcy court, the prospect of a new Washington Mutual (WAMUQ.PK) is now rapidly steaming "all ahead". Confirmation of the company's third plan of reorganization is set for February 16th and finally has the blessing of the company's equity committee after months of mediation over insider trading charges against four hedge funds which hold positions in the company's debt securities.
Troy Racki submits:Federal bankruptcy Judge Mary F. Walrath indicated on Thursday that she may allow for an examination into allegations that four hedge funds had participated in insider trading regarding Washington Mutual's (WAMUQ.PK) chapter eleven proceedings.
I have on numerous occasions made the claim that Henry Paulson is guilty of coercion and fraud. For those actions, he should be arrested and criminally tried.
However, the latest disclosure in which hedge funds say they were tipped off by Paulson while he told Congress and reporters blatant lies is allegedly not even criminal behavior.
Bloomberg reports Paulson Gave Hedge Funds Advance Word
Federal agents arrested a research firm executive on charges that he helped hedge funds get inside information, while a judge ruled that wiretaps could be used against the founder of the Galleon Group.
The government is convinced that money managers who consistently beat the market are probably using insider information to produce these abnormal returns. Unfortunately for prosecutors who want to shut this kind of thing down, one way this is done is perfectly legal.
Emergency Manager Kevyn Orr’s plan to suspend payments on US$2-billion of Detroit’s debt threatens a basic tenet of the US$3.7-trillion municipal market: that states and cities will raise taxes as high as needed to avoid default.
By Insider Monkey:
It is no secret that there are insiders and hedge fund managers who break the law and trade based on illegal inside information. We track corporate insiders and hedge funds because we believe they have an edge over ordinary investors. Corporate insiders know their companies and their industries way better than other investors. Even when they aren’t using inside information they are more likely to time their transactions better than ordinary investors.