FBI Probing Companies At Heart Of Meltdown

Collapse Of 4 Major U.S. Financial Institutions Helped Spur $700B Bailout Plan

(CBS/ AP)  The FBI is investigating four major U.S. financial institutions whose collapse helped trigger a $700 billion bailout plan by the Bush administration, The Associated Press has learned. In all, 26 high-profile companies are under intense scrutiny, reports CBS News correspondent Bob Orr.

Two law enforcement officials said Tuesday the FBI is looking at potential fraud by mortgage finance giants Fannie Mae and Freddie Mac, and insurer American International Group Inc. Additionally, a senior law enforcement official said Lehman Brothers Holdings Inc. also is under investigation.

The inquiries will focus on the financial institutions and the individuals that ran them, the senior law enforcement official said.

The law enforcement officials spoke on condition of anonymity because the investigations are ongoing and are in the very early stages.

Spokesmen for AIG, Fannie Mae and Freddie Mac did not immediately return calls for comment Tuesday evening. A Lehman spokesman did not have an immediate comment.

Just last week, FBI Director Robert Mueller put the number of large financial firms under investigation at 24. He did not name any of the companies under investigation but said the FBI also was looking at whether any of them have misrepresented their assets.

Over the past year as the housing market cratered, the FBI has opened a wide-ranging probe of companies across the financial services industry, from mortgage lenders to investment banks that bundle home loans into securities sold to investors. Mueller has previously said the FBI's hunt for culprits in the nation's subprime mortgage crisis focused on accounting fraud, insider trading, and failure to disclose the value of mortgage-related securities and other investments.

The investigations revealed Tuesday come as lawmakers began considering whether to approve emergency legislation that would give the government broad power to buy up devalued assets from troubled financial firms.

The bailout proposed by the Bush administration is aimed at helping unlock credit and stabilize badly shaken markets in the United States and around the globe.

In the past two weeks, the government has taken over Fannie Mae and Freddie Mac, the country's two biggest mortgage companies, with a bailout plan that could require the Treasury Department to put up as much as $100 billion for each of them over time if needed to keep them afloat as mortgage losses mount.

"I think the American public deserves some answers," Fox business analyst Liz Claman told CBS' The Early Show. "As soon as they get some, they should understand that this does have to get done in some way, shape or form."

Last week, the Federal Reserve provided an emergency $85 billion loan to AIG, which teetered on the brink of bankruptcy. Lehman Brothers was forced to file for bankruptcy after attempts to engineer a private rescue fell apart. All the companies were laid low from bad bets on complex mortgage-related securities.

Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke made the joint decision last week that the only way to stop the carnage was to deal with the root cause of all the troubles, billions of dollars of bad mortgage debt sitting on the books of major financial companies. This debt has triggered the worst credit crisis in decades, causing credit markets to essentially freeze up despite the fact that the Fed joined with major central banks around the world to pump billions of dollars of reserves into the financial system.

Additionally, the FBI is investigating failed bank IndyMac Bancorp Inc. for possible fraud. Countrywide Financial Corp., formerly the nation's largest mortgage lender and now owned by Bank of America Corp., is also under scrutiny.

[stevekelson-2009]

Col. Mustard in the library with the candlestick.

Secret code for What Firm, in what location, make the most money selling and trading derivatives?
It''s the losses from the trading instruments that caused the majority of the problem and the losses

The FBI''s first stop should be Phil Gramms office

[mcv57]

Posted by stn_sage

May God give you peace in heaven for your truth, and let the rest of this Country''s Law Enforcement Regime burn in HE*LL!

[mcv57]

The Bail-Scam is a SHELL GAME TO BUY TIME for the present legistrative branch and executive branch - to retire and shore-up legal manuvers.

WE THE PEOPLE, MUST CALL THE RETURN OF OUR MILITARY TO SIEZE THIS CORRUPT GOVERNMENT REGIME!

[mcv57]

The FBI - Fools, Bafoons, and Idiots? These people are nothing more than overpaid cops that add to the country''s law enforcement corruption.

[stn_sage]

Not that I have much faith in the FBI but, I hope they uncover some bad ***** of Watergate proportions and the finger gets pointed in the direction of the Bush administration.

Posted by u-r-right at 12:53 PM : Sep 24, 2008
------------------
The FBI has always been a little bit shady, especially under J. Edgar Hoover!

But under Mueller, it''s become nothing but a ''thug operation''! H3ll, they probably have a 1,000 agents tracking down every email that leads from some Wall Street business manager to Cheney and Bush and then DESTROYING the evidence of their involvement with Wall Street!

I''d be ashamed to be an FBI agent these days! The vast majority of the good agents quit long ago!

[inventagod2]

Greed and Sloppiness

Previous gifts I have granted Big Business:

Franklin National Bank 1974 $7.7 billion
Chrysler 1980 $3.9 billion
Continental Illinois National Bank and Trust Company 1984 $9.5 billion
Savings & Loan 1989 $293.8 billion
Bear Stearns 2008 $30 billion
Fannie Mae / Freddie Mac 2008 $200 billion
American International Group (A.I.G.) 2008 $85 billion

Hey buddy, can I borrow a Bil?

[lochlan-2009]

It''s all a sham. They''ve been playing us with these "investigations" for decades now to the tune of hundreds of millions of dollars, and no one ever is responsible, no one ever pays a fine in excess of what they''ve stolen, and no one ever goes to jail (except the multi-million dollar payed scape goat peons for a year or two to a private resort). Same sh@t, different day.

Congress deregulated and stood by and let it play out SO this could happen. They didn''t know it was coming, the whole scam was pointed out years ago with the fallout of the British bank for the same thing.

[helanwate]

Do an internet search on ACORN (Association of Community Organizations for Reform Now) and the mortgage mess.

You will see how these community organizing lobbying groups were involved in getting congress to put pressure on mortgage companies to be more lax in the home loan process and let more risky applicants get mortgages. Don''t you remember? It wasn''t that long ago that it was pretty hard to get a home loan.
Just remember that each person who signed a mortgage agreed to the terms of the contract they signed. I was always told to have a lawyer review and advise you on any contract you sign. There''s a whole lot of players involved in this "mess". We should have seen this coming 20 years ago. It''s stupid to think property values would always go up. Jeez, use your brain.

We should all feel responsible, as a country for this bail out. Finger pointing is just prolonging the problem. I think the elected people in Washington are afraid they may say something that will get their party tanked, so they won''t do anything. They are concerned about getting elected, not on how to fix anything. In the mean time, if your kids have a mortgage application on the table, forget it!

[kc629]

each company that gets bailed out in ANY way should have to give up their records and employees from top to bottom give up their salaries and bonuses, then we will see how much they deserve this bailout how much of these "loses" actually ended up in their pockets

the CEO''s of these companies need to be fired and tried in a court of law and forward EVERY penny they own into this $700 billion bailout that they are begging for,

[Gary Kempf]

If the FBI does find something, are they going to anymore than they did with the info they had on the terrorist prior to 911. We all know how well they did with that....

[raskal_2]

...if any person over prices an asset to trick another into buying a loan they cannot possibly afford, it is fraud, and it is entirely appropriate that they be be clamped in irons. If they are Muslim then you cut off the left(or dirty) hand. Period....

[tejasdemo]

Investigate my a ss!!!!! I''m sick of all the investigations !!!! Throw their butts in state prison and take film of it. Then show the film on national TV every night for a year.

[u-r-right]

AND may the finger point to BOTH political parties!

[u-r-right]

Not that I have much faith in the FBI but, I hope they uncover some bad ***** of Watergate proportions and the finger gets pointed in the direction of the Bush administration.

[stn_sage]

keep dreaming whitemale08, you will be a loser in any economy...you have proven that year after year

Posted by jamesm12341 at 10:49 AM : Sep 24, 2008
--------------------
At one point I noticed how you specialize in attacking other posters with these one line derogatory comments---a.k.a., cut''n run!

And I had a nice collection of a dozen and a half of them! It was my intent to post them to show the other posters what a caustic, sarcastic, uncaring fellow you truly are! But, I decided not to! Do you know why?
Because it seemed to me that even the densest poster had probably already figured that out on their own and didn''t need my help to do so!

whitemale08, is more of a man than you''ll ever be!
And, I don''t care what snotty comment you make in return!

[seafang]

NO taxpayer "assistance" for this scam should be approved, unless the bill calls for a full grand jury enquiry into all of this with a guarantee of hard and long jail time for ANYONE found to have lined their own pockets while laying the seeds of this mess. All those golden parachutes should be deflated and the funds returned to the taxpayers.

[middleman8]

Lets face it;
The FBI probe is nothing but a smoke screen to appease the public.
These CEO''s and the other crooks have already got it figured out how they will get million''s in bonuses and separation pay. They won''t let you join them and you can''t whip them.

[actornaught]

It will track back in some degree to Phil Gramm and John McCain.

Corporate welfare, and it''s big brother Deregulation are just the Big Money Grab, hit & run style. We''ll be hearing about all the untouchable individuals that got out with their Golden Parachutes.

You neo-conned mooks yap about the welfare state of the poor, but I''d gladly support those folks then this Corporate Welfare State. Easier to catch the little guys, and cheaper.

[tcoleman12]

Will this investigation look into the moneys that flowed from these companies to top level congressmen for political favors?
When Enron went down you heard every dollar that went to every Republican. Not so much about the hundreds of thousands that went from these companies to Clinton, Obama, Dodd and others.

[talkingham]

The Bush/McShame/Palin trickle down economy has failed, they have failed, and WAASTED A TRILLION DOLLARS to establish a Shiite Muslim government in Iraq. So who''s Muslim now?. They can''''t even talk about their own candidates because they have nothing to talk about, no new ideas, no solutions, only their complete pack of lies and hate. Meanwhile Bush/McShame have run the nation''s economy into the ground - McShame was deeply involved in the Reagan era Savings and Loan debacle. Every 25 years or so the Republican run the economy into the ground so the rich can scarf up the ruins of working people.

McShame/Palin = "The economy is fundamentally sound, let''s form a commission-" that was McShame''s original response to this crisis while as usual Bush can''t utter a complete sentence unless it''s a joke that only he laughs at.