DOJ and SEC Mortgage Investigations Overlap
Reuters has reported that the eleven bank subpoenas issued in January by DOJ expand upon previous document requests by the SEC in its ongoing investigations into improprieties relating to the packaging of residential mortgage securities.
According to the Reuters report, people who have reviewed the subpoenas state that the civil subpoenas ask for documents related to every residential securities offering between 2006 and 2008, including Fannie Mae and Freddie Mac bonds.
The SEC investigation that has been ongoing appears to have been limited to private offerings and did not include Fannie Mae or Freddie Mac bonds. The DOJ subpoenas have also apparently broadened the time period beyond the initial period being investigated by the SEC.
The investigations by the DOJ and the SEC appear to be a part of an inter-agency task force the government has organized to coordinate parallel efforts on current and future investigations. In January, SEC enforcement director Robert Khuzami said that his agency had already reviewed 25 million pages of documents as part of ongoing investigations into residential mortgage-backed securities.
Three firms, JPMorgan Chase & Co, Goldman Sachs Group Inc, and Wells Fargo & Co, have now disclosed that they have already received Wells notices from the SEC related to the SEC residential mortgage backed securities investigations. A Wells notice alerts putative defendants that the SEC is considering bringing charges and gives them a chance to rebut the allegations.
The Wells notice indicate that the SEC’s investigation against these three banks has matured to point that SEC charges should be forthcoming. However, the new round of broader DOJ subpoenas indicates that the government investigations will continue and possibly expand.
This entry was posted on Tuesday, March 6th, 2012 at 2:22 pm and is filed under Bank Fraud, bank whistleblower, corporate fraud, FHA fraud, government fraud, mortgage fraud, SEC Whistleblower Program, Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.