REGULATORS SEEK TO WIDEN INVESTIGATION INTO MBIA

New York attorney general Eliot Spitzer and the US Securities and Exchange Commission have asked US bond insurer MBIA for additional information about its business practices on top of subpoenas that they issued to the New York-based insurer late last year. MBIA said that the document requests relate to its accounting treatment of advisory fees; its methodology for determining loss reserves and case reserves; instances of purchase of direct default protection on itself; and information related to Channel Re, the Bermuda-based reinsurer part-owned by MBIA. The requests cover January 1, 2000 to the present. MBIA was originally subpoenaed last year in connection with reinsurance purchases that may have helped it cover losses in a bond insurance deal for failed Allegheny Health Education and Research Foundation.