“accurate reporting of risk actually may not have been a high enough priority in the mortgage-backed securities business, not when there was so much to be made off unsuspecting investors induced to buy into this hyped market.”

Securities Fraud Hotline Post, March 15, 2008.

Questionable business practices that have wreaked havoc in the credit markets has led to a series of probes in addition to the sub-prime investigation by New York state’s attorney general. As reported in the Wall Street Journal recently by Liz Rappaport, New York’s AG Andrew Cuomo’s latest target is, not surprisingly, the marketing of auction-rate securities. The AG has turned up the heat with subpoenas to Wall Street’s big players such as Merrill Lynch, Goldman Sachs, UBS, and Citigroup. It was also reported that Bryan Latagne, director of Massachusetts’ aggressive Securities Division, will spearhead a task force of state securities regulators investigating the auction-rate market debacle.*

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