On March 6, 2012, the DOJ announced that it intends to promptly bring criminal cases against both banks and individuals for their roles in selling risky mortgage-backed securities and for committing other crimes that deepened the financial crisis. In a speech to a national association of states’ attorney generals, Attorney General Eric Holder stated that the DOJ has recently subpoenaed at least 11 financial institutions related to their issuance of mortgage-backed securities and expects to bring prosecutions in coming months.
Recently, Citigroup acknowledged receipt of a DOJ subpoena by way of regulatory filings. While BofA also indicated that it had received subpoenas from unidentified regulators and government agencies, it did not mention the DOJ by name.
The DOJ is expected to rely on its Financial Fraud Enforcement Task Force and a newly created subgroup led by state attorneys general from New York, Delaware and Illinois, to investigate and prosecute such offenses. The larger group includes 55 DOJ attorneys as well as numerous members from other federal agencies. In addition, the DOJ has recently sought a substantial budgetary increase to investigate and prosecute financial crime for the 2013 fiscal year. (“DOJ Warns of Coming Criminal Cases Over Financial Crisis,” Law360.com, March 6, 2012.)