Fantastic! 
If the CEO of the company that made "Enzyte" can get 25 years in the Federal Pen for false advertising and marketing of his placebo, I can't wait to see what happens to these WaMu guys.
NEW YORK (Reuters) - Federal investigators have opened an investigation into the collapse of Washington Mutual Inc, the largest U.S. banking failure.
Jeffrey Sullivan, U.S. attorney for the western district of Washington, said in a statement on Wednesday that he has set up a task force that includes investigators from the FBI, the U.S. Securities and Exchange Commission, the Federal Deposit Insurance Corp and the Internal Revenue Service's criminal investigations unit.
"Given the significant losses to investors, employees and our community, it is fully appropriate that we scrutinize the activities of the bank, its leaders and others to determine if any federal laws were violated," Sullivan said in a statement. He said the probe comes on the heels of "intense public interest in the failure of Washington Mutual."
Federal regulators seized Seattle-based Washington Mutual on Sept 25 after the savings and loan, once the nation's largest, had $16.7 billion of deposit outflows in 10 days.
JPMorgan Chase & Co bought the Seattle-based thrift's banking units on that date for $1.9 billion, in a transaction arranged by regulators. Washington Mutual later filed for Chapter 11 bankruptcy protection from creditors.
Tom Kelly, a JPMorgan spokesman, declined to comment.
Washington Mutual collapsed amid soaring losses from mortgages and home equity loans, and less than three weeks after replacing its longtime chief executive, Kerry Killinger.
The Office of Thrift Supervision, which regulated the thrift, said on Sept 25 that Washington Mutual did not have enough liquidity to pay its debts, and was in an "unsafe and unsound condition to transact business."
http://www.reuters.com/article/newsOne/i...dChannel=0
10/17 addition.... As well as Countrywide and IndyMac
The top federal prosecutor in Los Angeles indicated Thursday that charges will be filed in the coming months in a sweeping investigation of banks and subprime lenders for their role in the nation's mortgage crisis.
"I think we are going to see some fairly dramatic results in the near future," U.S. Attorney Thomas O'Brien told The Associated Press. "There are people who have made many millions of dollars preying on unsuspecting people. That's wrong. That's fraud in a tremendous amount."
A grand jury is investigating at least three mortgage lenders —
Countrywide Financial Corp., New Century Financial Corp. and IndyMac Bancorp Inc. Prosecutors are looking at whether mortgage fraud and other white-collar crimes were committed.
O'Brien has just finished his first year overseeing the Central District of California, seven counties that became the heart of the nation's real-estate boom and bust. The area is home to many lending firms, including some which lured homeowners into taking out exotic loans with cheap teaser rates that mushroomed after a set time.
Thirty-four lawyers currently are looking at mortgage fraud and other white-collar crimes, now one of O'Brien's top priorities.
The government is pursuing a "surgical approach" in its investigations and hopes to streamline its prosecutions by seeking indictments with only a few counts, instead of spending several years seeking additional charges.
"We offer them three or four counts," O'Brien said. "We would get the same sentence and we plead them out and we move on to another crook."
O'Brien, 49, said his prosecutors are working closely with the Securities and Exchange Commission as well as other federal agencies in ongoing cases. He recently met with Rosalind Tyson, the SEC's regional director in Los Angeles.
Rebecca Lonergan, a former federal prosecutor and a law professor at the University of Southern California, said investigations have shown mortgage fraud to be rampant in the lending business during the housing boom. She recalled one case in which a maid claimed on her loan application that she made $11,000 a month.
These companies "would just sign off on applications no matter how ludicrous the information was," said Lonergan, who worked at the U.S. attorney's office for 18 years.
She said it's unlikely that any alleged misconduct was limited to the lower ranks in the lending institutions.
"Was it just individual loan officers who knew about this?" Lonergan said. "It seems to me unlikely, considering the scope of foreclosures going on right now."
She added, however, that investigators will have a difficult time trying to prove company executives knew what was going on.
Bank of America Corp. bought Countrywide in a deal approved by the lender's shareholders in June. Rick Simon, a Countrywide spokesman, did not immediately return a call seeking comment.
New Century sought Chapter 11 bankruptcy protection in April last year. It had been the nation's second-largest originator of subprime loans.
IndyMac is now being controlled by federal regulators after it failed in July.
http://www.iht.com/articles/ap/2008/10/1...gation.php
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Feds to investigate WaMu Failure, Countrywide and IndyMac.
