Subprime Crime Wave Floods FBI Casebook

A short-staffed FBI is laboring to keep up with white collar crime linked to the nation's financial crisis, the New York Times reports. FBI officials predicted millions of dollars' in mortgage fraud years ago, but the Justice Department wanted agents focused on counter-terror. When the FBI warned of a fraud "epidemic" in 2004, only 15 of its 13,000 agents were on the case.

Lawmakers in both parties are pressing the FBI to take on cases beyond its probes of big players like Lehman Brothers, and the bureau has added 1,500. But "they were very late to the game," one congressman said. The delay is about more than counter-terror efforts, according to interviews conducted by the Times: After Enron, the White House gutted guidelines for tackling corporate fraud and warned of "over-deterrence" on Wall Street, one ex-official said.
(More subprime crisis stories.)