A Senate panel has issued subpoenas to Goldman Sachs, Deutsche Bank and others, to investigate whether or not company executives knew in advance that the economy-destroying mortgage-related securities they created were complete crap.

Reports the Wall Street Journal:

The congressional investigation appears to focus on whether internal communications, such as email, show bankers had private doubts about whether mortgage-related securities they were putting together were as financially sound as their public pronouncements suggested.

According to people familiar with the matter, the Senate Permanent Subcommittee on Investigations also has issued a subpoena to Washington Mutual Inc., a Seattle thrift that was seized by regulators in last year's financial crisis and is now largely owned by J.P. Morgan Chase & Co.

It looks like welfare-queening your way to $11.4 billion in bonuses has its disadvantages, doesn't it? Typically sympathetic politicians are eager to put on their sheriff's hats for such things, apparently.

Senate Probes Banks for Meltdown Fraud [WSJ]