Tricadia

Times's Christmas Eve piece, including a little-known company called Tricadia that created particularly toxic CDO's to allow clients to bet against them, and whose vice chairman up until a month ago was a senior adviser to Treasury Secretary Tim Geithner.

CJR 2010

However, the Chicago company's trust-preferred security holders protested that plan, opening the door for Tricadia to push for a reorganization strategy instead.

FDIC Challenges Corus Eric Morath 2011

The Corus Bankshares CDOs that Tricadia bought into are collections of so-called trust-preferred securities, which are investment instruments issued by bank-created trusts.

Seized Lender Corus Bankshares Plots a Rarity—Bankruptcy Exit Eric Morath 2011

Under the proposal, unsecured creditors, primarily Tricadia and other holders of securities related to collateralized-debt obligations, or CDOs, owed a collective $415.6 million, would receive either stock in the reorganized company or a cash payment.

Seized Lender Corus Bankshares Plots a Rarity—Bankruptcy Exit Eric Morath 2011

At hearing set for July 28 at the U.S. Bankruptcy Court in Chicago, the company will ask a judge to allow it to send the plan it crafted alongside hedge-fund manager Tricadia Capital Management to creditors for a vote.

Seized Lender Corus Bankshares Plots a Rarity—Bankruptcy Exit Eric Morath 2011

Furthermore, the FDIC said the plan wrongly guarantees fees to Tricadia Capital Management, the hedge-fund manager that bought Corus Bankshares' securities tied to collateralized-debt obligations earlier this year, and then used its position to spearhead the current plan.

FDIC Challenges Corus Eric Morath 2011

The Chapter 11 proposal says that the FDIC's claim would stand on par with unsecured claims, including those of Tricadia and other investors that own so-called trust-preferred securities.

FDIC Challenges Corus Eric Morath 2011

A Tricadia representative declined to comment when reached Wednesday.

Seized Lender Corus Bankshares Plots a Rarity—Bankruptcy Exit Eric Morath 2011

The regulator also took exception to the fees that would be paid to Tricadia and the administrators of the bank-created trusts that issued the securities.

FDIC Challenges Corus Eric Morath 2011

Tricadia has said that it did warn those investors that other funds managed by Tricadia may be bearish on the housing market and said the firm didn't make negative bets on the same assets packaged into the CDOs.

Seized Lender Corus Bankshares Plots a Rarity—Bankruptcy Exit Eric Morath 2011