But it may be hard to jump-start such probes. Trying to prove that a major mortgage company intended to defraud buyers of its securities, for example, could take years of digging into records and testimony.
Moreover, some of those involved may have special legal protection: Credit rating firms have in other cases successfully asserted that their opinions about the values of securities are protected by the 1st Amendment.
"I am happy to have investigations going on, but these investigations should have taken place years ago," said Blair A. Nicholas, a San Diego lawyer representing investors who lost money in the collapse of several subprime mortgage lenders. "They seem to always get involved after the horse has left the barn. It is always cleaning up the mess rather than being proactive."
Could the crisis have been averted, or at least mitigated, if the FBI had intervened more forcefully?
"Until there is a catastrophic loss, there is no incentive to investigate criminal conduct," said Cynthia Monaco, a former federal prosecutor in New York. "Nor are there people coming forward with evidence" such as angry investors or whistle-blowing corporate employees, she said.
Even now, Monaco added, it is far from clear whether the damage -- suffered by investors and homeowners alike -- was the product of clear-cut fraud.
Ormsby says the FBI is more actively working with other federal investigative agencies in the hope they will pick up the slack. The Secret Service, for example, in a departure from its traditional missions of protecting presidents and heads of state and investigating counterfeiting, has assigned more than 100 agents to examine mortgage fraud, said spokesman Edwin Donovan.
The Justice Department is also starting to mobilize. The department offered what it described as a "basic seminar" on mortgage fraud cases to about 100 prosecutors last week at its national training academy in South Carolina.
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rick.schmitt@latimes.com
