Thursday, July 17, 2008

IndyMac Target for FBI Investigation

As reported by this article, on July 11th mortgage lender IndyMac was seized by the U.S. banking regulators making it the third largest banking failure in U.S. History. Reuters announced that in addition to the failure of the bank, it is now under investigation by the FBI for possible mortgage lending fraud.

Spokesman for IndyMac, Evan Wagner, released the following statement

"The first we heard of the investigation was in the press accounts today. We're not in a position to confirm or deny (the investigation) because it's an uncorroborated press account."

Also, he mentioned that

"It shouldn't be surprising that there is an investigation because of the size of the bank failure."

The FBI, have refused to comment but had announced on Wednesday that they had increased the number of corporations under investigation from 19 to 21 leading to the speculation that IndyMac was a target. Their probes are for fraud regarding securitizing loans, insider trading, and improper disclosure of the value of corporate assets.

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