March 24 The U.S. Securities and Exchange
Commission has launched an investigation into the increasing
number of complex bond deals on Wall Street that may create new
opportunities for fraud, the Wall Street Journal reported on
Investigators with the SEC are examining if banks and
companies are using the bond deals to hide risks illegally, the
newspaper reported, citing sources close to the matter.
The securities are packages of corporate loans and debts
that are assembled and sold by Wall Street Banks to investors.
They have gained in popularity after the financial crisis as
investors chase riskier investment products. (WSJ story: link.reuters.com/vuj87v)
The SEC is also investigating whether a number of banks
including Barclays, Citigroup, Deutsche Bank AG
, Goldman Sachs Group, Morgan Stanley,
Royal Bank of Scotland and UBS AG have been
cheating their clients by mispricing certain bond deals.
The SEC was not immediately available for comment outside of
normal business hours.
(Reporting by Narottam Medhora in Bangalore; Editing by Lisa