[JURIST] The Federal Bureau of Investigation [official website] is currently investigating Fannie Mae, Freddie Mac, Lehman Brothers, and AIG [corporate websites] along with 22 other financial institutions for possible mortgage fraud [FBI backgrounder], US media outlets reported Tuesday. The investigations follow a market collapse that led to a Bush administration proposal [fact sheet; JURIST report] circulated over the weekend that would authorize the Treasury Department to acquire as much as $700 billion in mortgages and other loans. Though FBI officials would not comment on which firms are involved in the ongoing inquiries, ABC News reported [text] that FBI spokesman Richard Kolko has confirmed 26 "pending corporate fraud investigations involving subprime lenders." AP reported [text] that the investigations are in the "early stages." The Wall Street Journal has more.

In June, the FBI announced that more than 400 people had been indicted [press release; JURIST report] in connection to what has been termed the US "sub-prime mortgage collapse." The vast majority of the indictments involved fraud related to individual mortgages, with the FBI focusing on lending fraud, foreclosure rescue scams and mortgage-related bankruptcy schemes, which account for more than $1 billion in losses. Earlier month, mortgage giants Fannie Mae and Freddie Mac were placed into a conservatorship under the Federal Housing Finance Agency [CNN report], investment bank Lehman Brothers filed Chapter 11 bankruptcy [AP report], and the Federal Reserve took control of nearly 80% of the shares [Reuters report] of leading insurer AIG. New York Attorney General Andrew Cuomo has also announced a state investigation [JURIST report] into whether some investors used illegal methods to profit from the recent declines in banking and insurance stocks, possibly by short-selling [Forbes backgrounder] stock and spreading of false information to illegally gain from the devaluations in Lehman Brothers, AIG and other stocks.