In separate lawsuits filed in a New York federal court, a $58m hedge fund alleges that Citigroup and Wachovia, respectively, improperly required the fund to pay out more money from credit default swaps - insurance derivatives contracts - amid a steep decline in the value of mortgage-backed bonds, reports the WSJ. The fund - VCG Special Opportunities Master Fund, owned by an investment firm that also owns a Puerto Rican investment bank – was at the time named the CDO Plus Master Fund.
