Just saw this on the Bloomberg news channel ticker:
Cuomo Widens Short-Selling Probe to Credit-Default Swaps Market
New York Attorney General Andrew Cuomo has expanded his investigation of short selling to include trading in the $54.6 trillion credit-default swaps market, according to a person in his office.
Cuomo is probing whether credit-default swaps were manipulated by short sellers through the use of false rumors about financial companies such as bankrupt Lehman Brothers Holding Inc. to drive stock prices down, the person said.
Several regulators are focusing on credit-default swaps to see if the bets are fueling the global financial crisis. U.S. Securities and Exchange Commission Chairman Christopher Cox said Sept. 23 that Congress should immediately grant authority to regulate the swaps, which investors use as insurance against a drop in the value of investments, such as bonds.
I have more questions than comments and anaysis. Once someone more knowledgable writes a diary I will delete this one.
``The absence of regulatory oversight is the principal cause of the Wall Street meltdown we are currently witnessing,'' New York Governor David Paterson said Sept. 22 in announcing his state's new regulation of the market.
Cuomo yesterday subpoenaed three companies that provide price and trading data on the credit-default swaps market: Markit Group Ltd., Depository Trust & Clearing Corp. and Bloomberg LP, the parent of Bloomberg News, according to the person in his office.
Bloomberg
While googling I also found this from 2007. Washington Mutual Inc. put pressure on American Corp to inflate home values? WOW. Maybe Washingotn Mutual should have gone down. I read about all these investigations, but never the results. Are people getting prosecuted or not.
November 7, 2007 11:26 EST
Cuomo Widens Investigation to Fannie Mae, Freddie Mac (Update3)
New York Attorney General Andrew Cuomo expanded his investigation of the mortgage industry to include Fannie Mae and Freddie Mac, the two biggest U.S. providers of mortgage financing.
The mortgage providers' shares fell after Cuomo said in a statement that he plans a news conference today in New York to announce ``a significant new development in his expanding investigation into the mortgage industry involving Fannie Mae and Freddie Mac.''
By adding the two government-chartered enterprises, Cuomo is broadening his nine-month probe to companies that own or guarantee 40 percent of the $11.5 trillion of U.S. residential mortgage debt. He last week sued the real estate appraisal unit of First American Corp., the biggest U.S. title insurer, accusing it of inflating home values under pressure from Washington Mutual Inc.
Bloomberg