Friday, January 22, 2010


BANZAI7 NEWS--McClatchy News reports One of Congress' premier watchdog panels is investigating Goldman Squid's role in the subprime mortgage meltdown, including how the firm sold securities backed by risky home loans while it simultaneously bet that those bonds would lose value, people familiar with the inquiry said Friday.

The investigation is part of a broader examination by the Senate Permanent Subcommittee on Investigations into the roots of the economic crisis and whether financial institutions behaved improperly, said the individuals, who insisted upon anonymity because the matter is sensitive.

Disclosure of the investigation comes amid a darkening mood at the White House, in Congress and among the American public over the long-term economic impact of the subprime crisis, prompting demands to hold the culprits accountable.

It marks at least the third federal inquiry touching on Goldman's tentacles related to securities backed by risky home mortgages.

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