New York State Attorney General Eric Schneiderman has requested information from three of the nation's most powerful Wall Street firms in connection with what sources call an "active and ongoing investigation into the mortgage crisis."
The firms, Bank of America, Goldman Sachs and Morgan Stanley, bundled mortgages into securities and sold them to investors, which some say helped banks conceal troubled loans. No specific allegations of wrongdoing have been lodged yet.
Last October attorneys general in all 50 states, along with the Department of Housing and Urban Development, began an investigation into the mortgage crisis. Settlement negotiations have been ongoing. Schneiderman's investigation is a "distinct and broader inquiry," according to sources familiar with it.
In striking out on his own against the Wall Street bastions, Schneiderman is following the aggressive path forged by predecessors Andrew Cuomo and Elliot Spitzer, who made prosecution of financial fraud a centerpiece of their tenures.
Schneiderman plans to meet with executives of Bank of America, Goldman Sachs and Morgan Stanley to discuss their mortgage practices, sources told ABC News. Those meetings, expected to take place in the next couple weeks, were first reported by The New York Times and Wall Street Journal.
Sources told ABC News that Schneiderman does not intend to "prejudge" the process of "securitization" -- the bundling of mortgages into securities -- but has requested meetings and will be asking questions.
Mortgage loans packaged as securities were attractive to investors in part because the nation's largest credit rating agencies often gave them triple-A ratings. A triple-A rating generally means that a security is not likely to default, but this wasn't the case with many of the bundles big banks offered -- some of the Triple-As defaulted.
The 2nd U.S. Circuit Court of Appeals in New York determined earlier this week that the ratings agencies, including Standard and Poor's, Fitch Ratings and Moody's Investors Service, could not be held liable for their ratings.