Seeking Alpha – 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 chapter eleven proceedings.
Suspicions were originally raised by independent watchdog investor Nate Thoma who made statements during the company’s plan of reorganization hearing. Mr. Thoma accused Appaloosa Management LP, Aurelius Capital Management LP, Centerbridge Partners LP and Owl Creek Asset Management LP of using insider knowledge from closed door settlement negotiations between WaMu, JP Morgan (JPM), and the FDIC to purchase parent company junior subordinated debt issues at steep discount.
