NY Attorney General—and presumed gubernatorial candidate—Andrew Cuomo is reportedly looking into whether banks such as Goldman Sachs, Morgan Stanley, UBS, Citigroup, Credit Suisse, Deutsche Bank, Crédit Agricole and Merrill Lynch (now owned by Bank of America) duped credit ratings agencies about mortgage securities. According to an AP source, Cuomo "is trying to figure out if banks provided the agencies with false information in order to get better ratings on the risky securities."

The NY Times adds, "Mr. Cuomo is also interested in the revolving door of employees of the rating agencies who were hired by bank mortgage desks to help create mortgage deals that got better ratings than they deserved." Goldman Sachs was the only bank to respond for comment (Morgan Stanley, Credit Suisse, UBS and Deutsche Bank declined, while Merrill, Citigroup, and Credit Agricole didn't respond), "Any suggestion that Goldman Sachs improperly influenced rating agencies is without foundation. We relied on the independence of the ratings agencies’ processes and the ratings they assigned."

But the Times points out that the SEC's fraud complaint about Goldman's mortgage securities involves a deal "devised in part by a former Fitch Ratings employee named Shin Yukawa, whom Goldman recruited in 2005. At the height of the mortgage boom, companies like Goldman offered million-dollar pay packages to workers like Mr. Yukawa who had been working at much lower pay at the rating agencies, according to several former workers at the agencies."

And then the SEC's and federal prosecutors' preliminary investigations into fraud now include JP Morgan, Citigroup, Deutsche Bank and UBS.