The judge could penalize the funds by cutting the amount of interest they can collect on their Washington Mutual debt, or she could even reject the reorganization plan if she finds it was not negotiated in good faith.
I really like seeing the statement in bold above being mentioned in the press!!
(Reuters) - A hedge fund accused of trading on confidential information gleaned from the Washington Mutual Inc bankruptcy went so far as to sound-proof an office to prevent the information from reaching its traders, a managing director of the fund testified.
Funny how they fail to mention that Gropper's office was sound proofed AFTER the 1st Confidentiality period. Hmmm...