Berkshire sells some ResCap debt as it seeks probe
* Berkshire says sells more than $500 mln unsecured bonds
* Berkshire owns more than $900 mln junior secured bonds
* Appointment of examiner has been sought
* ResCap, an Ally mortgage unit, sought bankruptcy on May 14
June 8 (Reuters) - Warren Buffett's Berkshire Hathaway Inc sold more than a third of its Residential Capital LLC bond holdings this week, shortly after calling for a probe into the mortgage lender's pre-bankruptcy transactions.
Ted Weschler, a Berkshire investment manager, said his company sold its holdings of more than $500 million of unsecured ResCap bonds on June 5 and 6, according to papers filed Thursday in U.S. Bankruptcy Court in Manhattan.
Weschler did not disclose sale prices. Berkshire had held the bonds for several years.
The sales followed Weschler's June 4 request for the court to appoint an independent examiner to investigate "potentially improper" transactions, in which ResCap moved large amounts of assets to its parent, Ally Financial Inc.
Berkshire still owns more than $900 million of ResCap's junior secured bonds, or more than 40 percent of the total, Weschler said in the court filing.
The bond sales do not affect Berkshire's capacity to demand an examiner, who works for the benefit of creditors and the bankruptcy estate and may investigate allegations such as dishonesty, fraud, incompetence and mismanagement.
A committee of unsecured ResCap creditors has also requested authority to investigate transactions that the lender conducted prior to its Chapter 11 filing on May 14.
Ally, the former General Motors in-house financing arm, did not seek court protection from creditors. The U.S. government owns nearly 74 percent of Ally.
The case is In re: Residential Capital LLC, U.S. Bankruptcy Court, Southern District of New York, No. 12-12020.
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