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'The Federal Bureau of Investigation said it is conducting a wide-ranging inquiry into the insurance industry and could extend the probe to banking and other financial sectors, in the wake of the accounting scandal at American International Group Inc.'

'"We have a very wary eye on the insurance industry because of AIG," said Chris Swecker, assistant director of the FBI's criminal investigative division...Mr. Swecker said the FBI has found in previous corporate-fraud cases that they tended to involve more than one player in an industry. "If one was doing it, others had to stay competitive," said Mr. Swecker. FBI officials began looking into the insurance industry almost a year ago, though they have stepped up their efforts in recent months. They are now considering whether to add more agents to the probe.',,SB111523416486324807,00.html?mod=home_whats_news_us (subs)

This is bad news for both financial services firms and their huge stakeholder base - customers, vendors, shareholders etc. Which means bad news for the market. All we need is another bout of Enronitis to get the lawyers and legislators baying for blood while the market collapses in a nervous wreck.

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