SEC probes ResCap for potential mortgage fraud

The Securities and Exchange Commission disclosed in a court filing that it was investigating Residential Capital for possible mortgage origination and securities fraud, according to Reuters.

Investigators began the probe in February into possible omissions or misrepresentations in the mortgage bonds the now bankrupt unit sold to investors. The agency requested forcing due diligence firm R.R. Donnelly & Sons to hand over documents it prepared for the investment banks in the deals.

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