9 banks in mortgage probes
By JoAnne Allen and Steve Slater |
May 14, 2010, Friday
|
Print Edition
Print Edition
FIVE United States banks and four European lenders are being investigated by US authorities as they widen their probe of the role of banks in past mortgage securities deals, according to news reports.
The New York attorney general has begun an investigation into eight banks to determine whether they provided misleading information to agencies that rate mortgage securities, The New York Times reported yesterday.
New York Attorney General Andrew Cuomo's office issued subpoenas on Wednesday notifying the banks of his investigation, the Times reported.
The investigation's targets are Goldman Sachs, Morgan Stanley, UBS, Citigroup, Credit Suisse, Deutsche Bank, Credit Agricole and Merrill Lynch, now owned by Bank of America, the report said.
Separately, the Wall Street Journal reported that US federal prosecutors, working with securities regulators, were conducting a preliminary criminal investigation into whether four banks misled investors about their roles in mortgage bond deals.
The banks under scrutiny were JPMorgan Chase, Citigroup, Deutsche Bank and UBS, wsj.com said.
They have also received civil subpoenas from the US Securities and Exchanges Commission as part of an investigation of banks' selling and trading of mortgage-related deals, the report said.
A spokesman for JPMorgan said it had not been contacted by federal prosecutors and was not aware of any criminal investigation. The other banks either declined comment or were not immediately available.
The reports come less than a month after the SEC charged Goldman with fraud over its marketing of a subprime mortgage product.
US federal investigators are also probing Morgan Stanley, the Wall Street Journal said. Chief Executive James Gorman said he had no knowledge of any federal investigation.
The companies that rated the mortgage deals were Standard & Poor's, Fitch Ratings and Moody's Investors Service, it said.
The New York attorney general has begun an investigation into eight banks to determine whether they provided misleading information to agencies that rate mortgage securities, The New York Times reported yesterday.
New York Attorney General Andrew Cuomo's office issued subpoenas on Wednesday notifying the banks of his investigation, the Times reported.
The investigation's targets are Goldman Sachs, Morgan Stanley, UBS, Citigroup, Credit Suisse, Deutsche Bank, Credit Agricole and Merrill Lynch, now owned by Bank of America, the report said.
Separately, the Wall Street Journal reported that US federal prosecutors, working with securities regulators, were conducting a preliminary criminal investigation into whether four banks misled investors about their roles in mortgage bond deals.
The banks under scrutiny were JPMorgan Chase, Citigroup, Deutsche Bank and UBS, wsj.com said.
They have also received civil subpoenas from the US Securities and Exchanges Commission as part of an investigation of banks' selling and trading of mortgage-related deals, the report said.
A spokesman for JPMorgan said it had not been contacted by federal prosecutors and was not aware of any criminal investigation. The other banks either declined comment or were not immediately available.
The reports come less than a month after the SEC charged Goldman with fraud over its marketing of a subprime mortgage product.
US federal investigators are also probing Morgan Stanley, the Wall Street Journal said. Chief Executive James Gorman said he had no knowledge of any federal investigation.
The companies that rated the mortgage deals were Standard & Poor's, Fitch Ratings and Moody's Investors Service, it said.
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