FBI agents change focus from terror work to Madoff

New York: The Federal Bureau of Investigation (FBI) has had to change agents from terror and other crime work to Wall Street investigations including the alleged Bernard Madoff Ponzi scheme, said David Cardona, head of the New York office's criminal division.

The Federal Bureau of Investigation has had to engage in "triage" in responding to successive frauds involving subprime mortgages, auction-rate securities and Madoff, who prosecutors said confessed this month to bilking investors out of $50 billion, Cardona said in an interview.

"We have to work those cases which we think pose the greatest threat," he said. "In this case, it's a threat to the financial system and Wall Street. It is the same with mortgage fraud. I'm ramping these squads up."

The fall in the stock market this year did not create the recent surge in financial crimes, Cardona said.

"Mortgage fraud was perpetrated in good times, but no one saw it," Cardona said. "In bad times, as we are in now, you see the manifestation of the crime problem. It was there, but like the tide going out, you just didn't see until the margin calls started coming in."