Irish banks are lining up with regulators in Britain and Ireland, to pursue legal action against hedge funds suspected of spreading misleading information to profit from recent stock market falls.
Market sources have identified at least four specialist hedge fund firms, based in London and the US, that are believed to have bet heavily on sharp declines in the share prices of British and Irish banks.
Regulators are expected to probe their trading patterns and any communications they may have had with other market participants to establish whether they were guilty of illegally manipulating share prices.
