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Alden Global Capital, a prominent hedge fund that controls more than 100 local newspapers, moved nearly $250 million of employee pension savings into its own accounts in recent years, an unusual move that is triggering federal scrutiny, the Washington Post reported. The hedge fund, which is the controlling owner of such newspapers as the Denver Post and Boston Herald under the brand MediaNews Group, in some cases moved 90 percent of retirees’ savings into two funds it controlled, according to public records filed with the Labor Department. Most of the money has now been moved back out of the hedge funds. Federal law generally requires that pension managers avoid conflicts of interest and avoid taking excessive risks with the assets they manage, experts said, though some exemptions are allowed. Alden is being investigated by the Department of Labor for management of its pensions, a hedge fund spokesman confirmed. The specific nature of the investigation is unclear, but one person familiar with the agency’s inquiry, speaking on the condition of anonymity because the investigation is confidential, said the department issued subpoenas to Alden and its partners last year.

Sycamore Partners on Tuesday engineered a $5.4 billion refinancing of Staples Inc., which it bought in 2017, that funded a $1 billion dividend to the private equity firm, Bloomberg News reported. Combined with a payment it took in January, it means Sycamore has recovered — in less than two years — roughly 80 percent of the equity it originally put up as part of the deal. Sycamore’s aggressive tactics have at times led to litigation and claims from creditors of hastening or exacerbating losses. That kind of financial engineering had seemed to be the playbook after Sycamore bought Staples at a valuation of $6.9 billion, its biggest takeover ever. Sycamore contributed $1.6 billion of equity and raised $4 billion of debt for the company’s more promising wholesale division, which sells office supplies to large corporations, according to people familiar with the matter. At the same time it spun off the U.S. and Canadian retail operations into separate entities. Sycamore took $300 million of that equity back in January as part of a complex deal to acquire Essendant Inc., another office supplies distributor, and then soon started pitching the dividend recapitalization that would pay them another $1 billion. But that proposal, missing typical investor protections, so alarmed some creditors that, on the day investors were told about the deal, the cost to insure Staples debt against default for five years saw its biggest increase since 2012, according to data provider CMA.

The House Financial Services Committee will hold a hearing today at 10 a.m. EDT titled “Holding Megabanks Accountable: A Review of Global Systemically Important Banks 10 years after the Financial Crisis.” To view the witness list and to access a live webstream to the hearing, please click here.

A top markets regulator said he was concerned about the growth of loans by banks to highly indebted companies, joining other policy makers who have highlighted risks that leveraged loans could pose to financial markets, the Wall Street Journal reported. Securities and Exchange Commission Chairman Jay Clayton on Monday said that in the leveraged-loans sector, he saw echoes of the period before the 2008 financial crisis when market expectations were “out of step with reality” and ultimately proved wrong. “To the extent that large concentrations of leveraged loans with long settlement cycles are in funds, that’s a case where liquidity expectations may be out of whack,” Clayton said. Lending by banks and other financial companies to highly indebted companies has grown in recent years, with the leveraged-loan business marking a bright spot for banks seeking to boost income during a period of low interest rates. In recent months, regulators at the Federal Reserve and Democrats in Congress have drawn attention to the systemic risks posed by the popularity of heavily leveraged loans.