Allied Capital, a business lending group locked in a bitter battle with a hedge fund, said that federal prosecutors have asked for information on how it obtained private phone records from the hedge fund’s president. The statement from Allied is the latest salvo in a complex five-year fight between the lender and hedge fund Greenlight Capital, headed by David Einhorn. Greenlight has been betting against Allied’s stock for five years, claiming the company overvalues some assets. An Allied subsidiary, Business Loan Express, has been under investigation by the US Attorney for the District of Columbia and the Securities and Exchange Commission over accounting issues. Mr Einhorn and Greenlight have also filed a federal lawsuit, in the name of the US government, alleging that BLX submitted fraudulent loan documents to the federal Small Business Administration. Mr Einhorn has also claimed that Allied used “pretexting” - using a false identity to obtain private records from the phone company - to get hold of his and other Allied critics’ phone records.
