Friday, May 14, 2010
Andrew Cuomo better stay away from airplanes, open limos and prostitutes!
Eight banks face US investigation
New York Attorney General Andrew Cuomo is looking at whether the relationship between the banks and credit rating agencies was manipulated to gain a better ratings for risky securities.
The banks under investigation are believed to include Goldman Sachs and Morgan Stanley.
Bad US mortgage debt was one of the main causes of the financial crisis.
This is because much of the investments were repackaged into wider debt offerings and then resold around the world.
This spread the problem of bad debt to other banks when subprime US households - those on low earnings, or deemed a risky investment - began to default on their mortgage payments.
Link to article: