More Indictments Expected in Muni-Bond Scandal

Considering the amount of politicians, financial houses, and others associated with the muni-bond scandal this isn't much of a surprise. Add to this the fact that states such as West Virginia and Florida have increased the pressure to find out what happened and you have a recipe for trials and prosecutions across the country.

(Bloomberg) CDR Financial Products Inc. and three of its employees aren’t entitled to early access to prosecution evidence in a U.S. antitrust investigation of the $2.8 trillion municipal bond market and more indictments are expected, a prosecutor told a federal judge in New York.

Lawyers for the CDR defendants went to court yesterday to ask U.S. District Judge Victor Marrero to direct the government to give them early access to the evidence and identify material that might help clear their clients. Rebecca Meiklejohn, a lawyer with the Justice Department’s antitrust division, said the government’s investigation is still moving ahead.

“This is a very expansive case,” Meiklejohn told Marrero. “Just this week the government indicted more individuals in connection with this investigation. This is a continuing investigation and we expect there to be more indictments.”

CDR and the three employees are charged as part of an ongoing probe of bid- and auction-rigging in the municipal bond market. Three ex-bankers with a General Electric Co. unit were indicted on July 27 in the same federal probe.

The federal probe already has drawn in more than a dozen banks and financial services companies, including JPMorgan Chase & Co., Bank of America Corp. and UBS AG, according to court records and regulatory filings.

We have already seen the indictment of ex General Electric executives, guilty pleas from others, and the only thing that saved BOA was the fact that they have decided to work hand in hand with the DOJ. To this day I am convinced Bill Richardson and company were too big to fail and dodged a huge bullet courtesy of Eric Holder.