The U.S. Securities and Exchange Commission (SEC) has scanned the trades made by Appaloosa, a $13 billion hedge fund, when Wells Fargo & Co agreed to buy Wachovia Corp in 2008, the Journal said citing people familiar with the matter.
Appaloosa is cooperating with the probe, the people told the paper.
SEC has also scrutinized trades by the Dallas-based Carlson, which manages $4.9 billion in investments, relating to four secondary stock offerings made between late 2007 and the middle of 2009, the paper said, citing a person familiar with the matter.
Carlson Capital has been cooperating voluntarily and fully with the SEC relating to an inquiry in connection with 'Rule 105,' and will continue to do so, a spokesman told the paper in an email.
Rule 105 prohibits a short seller from covering short sales with offering securities purchased from an underwriter or broker five days prior to pricing of the securities.
The reason for the prohibition is that pre-pricing short sales that are covered with offering shares artificially distort the market price for the security, the SEC said in its website.
Appaloosa and Carlson Capital could not be immediately reached for comment by Reuters outside regular U.S. business hours.
(Reporting by Sakthi Prasad in Bangalore; Editing by Muralikumar Anantharaman)