The Wall Street Journal once again confirms what is becoming increasingly clear. There is a large, widespread investigation going on right now into the workings of Wall Street banks during the crisis.
According to the paper’s latest report — yesterday it broke the news that Morgan Stanley (MS) was under a preliminary CRIMINAL investigation — the Manhattan DA’s office and the SEC are working side by side, and that JPMorgan, Deutsche Bank, Citigroup, and UBS have all received civil subpoenas at this point.
So far that’s it. The investigations by all accounts, including Charlie Gasparino’s yesterday, appear to be very much in their initial stages, and there’s no guarantee that charges will come of them.
One thing this stories have in common — and to some extent this is probably due to the preliminary nature of the investigations — is a lack of detail into what, exactly, the banks did, other than package CDOs that went bad.
No doubt investigators are looking for clear instances of misleading investors, though at first blush, it seems their primary test for that is whether or not that bank was shorting what it sold.
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