By JAYMES SONG
The Associated Press
Friday, February 1, 2008; 3:09 AM
HONOLULU -- FBI Director Robert Mueller said Thursday that the agency
is committed to investigating and prosecuting companies involved in
mortgage fraud and other violations in connection with home loans made
to risky borrowers.
Mueller said probes were being conducted across the country, including
in Hawaii, where he stopped on his way back from a trip through Asia.
"There is not a state that does not have some investigation," he told
re****ters at the FBI office in Honolulu. "It is a substantial problem
but we've been through problems like this in the past."
The FBI said Tuesday it was working with the Securities and Exchange
Commission to investigate 14 companies, from mortgage lenders to
investment banks, for possible accounting fraud, insider trading or
other issues connected to subprime mortgage lending.
Mueller declined to identify the companies.
The FBI allocated substantial manpower and resources to address the
savings and loan crisis in the early 1990s and cor****ate fraud earlier
this decade, and Mueller said he was prepared to do the same to
address fraudulent lenders.
"I anticipate that we will see the same extensive investigations that
we saw then with successful prosecutions following those
investigations," Mueller said.
As the nation's housing crisis worsens, there has been a dramatic
spike in the number of mortgage fraud cases under investigation. An
FBI spokesman said 1,210 such cases are open, up from roughly 800 a
year ago.
The bureau is looking into the practices of so-called subprime
lenders, as well as potential accounting fraud by financial firms that
hold subprime loans on their books or securitize them and sell them to
other investors.
During his trip to Asia, Mueller met Chinese officials in charge of
security for this summer's Olympic Games in Beijing. He also was in
Cambodia to inaugurate an FBI office at the U.S. Embassy in Phnom
Penh.
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