Fbi probe subprime ‘crime’

Some of America's top bankers face possible jail sentences after the FBI launched an investigation into the US sub-prime crisis...

The high-risk mortgage debacle sparked a world economic slowdown and saw many Americans lose their homes. Detectives will probe 14 companies for accounting fraud relating to the sub-prime loans.

"There are some irregularities we are looking at - (this is) good old fashion greed," said Neil Power, chief of the FBI's Economic Crimes Unit.

He alleges that some financiers knew about the sub-prime crisis before the problems took hold. The crisis began after the US housing price bubble burst months ago and left millions of homeowners holding high-interest rate mortgages they could no longer afford. Many are now losing their homes.

FBI officials declined to name the companies involved. Mr Power further commented: “We are co-operating with the Securities and Exchange Commission, which has confirmed at least three dozen investigations related to the sub-prime mortgage market”.