Justice Department confirms probe into credit default swaps
By APThursday, July 16, 2009
Feds confirm probe into credit default swaps
WASHINGTON — The Justice Department says it is investigating the credit derivatives industry.
Department spokeswoman Laura Sweeney said Wednesday the antitrust division is probing possible anticompetitive practices in the credit derivatives clearing, trading and information services industry.
Confirmation of the probe comes a day after the trading information services company Markit Group Ltd. said it was being investigated in relation to the market for credit default swaps.
Credit default swaps are contracts that protect against corporate defaults by paying the face value of a bond or loan to the buyer if a company fails to meet its debt agreements.
Markit owns the benchmark credit derivatives indexes in the U.S. and Europe.
