As the subprime mortgage meltdown grows, some experts are starting to see the resulting fallout rivaling corporate scandals of earlier this decade, like Enron, that prompted the passage of the Sarbanes-Oxley Act.
Even former Securities and Exchange Commission Chairman Arthur Levitt expects to see more massive writedowns on the way. He believes banks aren’t being candid about the full extent of their subprime mortgage holdings. Last week, he told Bloomberg News that he thinks the Financial Accounting Standards Board should force the banks to close a loophole that lets them keep the structured investment vehicles holding subprime debt off their balance sheets.
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