The FBI said it is investigating whether accounting fraud or other crimes were committed by mortgage lenders, loan brokers and Wall Street banks involved in extending loans to borrowers with poor credit. The agency has refused to identify the companies under investigation since the probe began last spring. However, it is known that at least 14 companies are involved. The FBI is cooperating with the SEC, which is investigating how subprime loans were made and packaged, and how the securities they backed were valued.
FBI Director Robert Mueller said investigators believe a "substantial" amount of mortgage fraud was committed in connection to home loans made to risky borrowers. The bureau is looking into the practices of subprime lenders. Agents also are probing potential accounting fraud by financial firms that hold subprime loans themselves or securitize them and sell them to other investors.
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