California AG Slaps Citi With Subpoena In Probe Into Bankster's MBS-Peddling Activities

The Los Angeles Times reports:

• California Atty. Gen. Kamala D. Harris has subpoenaed Citigroup Inc. and its banking subsidiary, Citibank, ordering the two entities to answer questions regarding the selling and marketing of mortgage-backed securities in the Golden State, a person familiar with the investigation said.



• The person, who was not authorized to speak publicly about the matter and spoke on condition of anonymity, would not further characterize the nature of the investigation. Spokespeople for the attorney general's office and Citi declined to comment.



• In May, Harris announced the creation of a Mortgage Fraud Strike Force that would target mortgage fraud of any size. Harris said then that she would tackle corporate fraud, including instances in which bundled mortgages were sold as securities to the state or its pension funds under false pretenses.



• To prosecute some of the cases, Harris said she would use California's False Claims Act, which makes it a crime to defraud the state.

For more, see California subpoenas Citigroup about mortgage-backed securities (The state attorney general orders the bank to answer questions about how it sold and marketed the securities in the Golden State).