New York state prosecutors have sent subpoenas to Wall Street firms seeking information related to the packaging and selling of debt tied to high-risk mortgages, the Wall Street Journal reported, citing people familiar with the matter.The subpoenas, sent by the New York attorney general Andrew Cuomo's office, request information from Merrill Lynch & Co., Bear Stearns Cos. and Deutsche Bank AG, people familiar with the matter told the Journal.
A spokesman for the attorney general's office declined to comment on the report.
The investigation is examining how adequately investment banks reviewed the quality of mortgages before packaging them into products that were then sold to investors, the people told the Journal, adding that the subpoenas also requested information about how the debt was pooled into securities, including the banks' relationship with credit-rating firms.
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