The New York Time and the Associated Press are reporting that the New York State Attorney General, Eric Schneiderman, is quietly investigating three major American banks and their role in the mortgage securities market prior to the housing crash.  Gretchen Morgenson writing in the Times says that Bank of America, Goldman Sachs, and Morgan Stanley have been asked for information and documents and Schneiderman's office has requested meetings with bank representatives.

Morgenson gathered her information from people who were briefed on the matter but are not authorized to speak publicly.  She said that the inquiry appears to be "quite broad" with requests for information covering many aspects of the banks' loan pooling operations.

The three banks were among many who put together bundles of home loans and used to them as collateral for securities sold to investors such as insurance companies and pension funds.  Millions of the loans have defaulted, leaving many investors with virtually useless paper.  

The Associated Press is reporting that Schneiderman has already scheduled meetings with the banks which are expected to focus on the mortgage securities operations.

According to Morgenson, the requests from the AG's office seems to confirm that Schneiderman is unwilling to accept one of the terms of the settlement agreement proposed between financial institutions and the attorneys general of most other states.  That condition would require regulators to forego additional investigations into the banks' activities during the time leading up to the mortgage crisis.  The other attorneys general have focused their inquiry primarily on the actions of servicers many of which are subsidiaries of major banks.

It is unclear whether Schneiderman is looking at filing charges or if those charges will be civil or criminal in nature.  His predecessor, now New York Governor, Andrew Cuomo pursued some mortgage lenders aggressively winning changes regarding appraisal standards and other concessions but no charges were filed against any banks.