Attorneys general in dozens of states plan to launch a joint probe into charges that banks used bogus paperwork to evict borrowers from their homes.
The investigation will go after charges that lenders including GMAC, JPMorgan Chase (JPM) and Bank of America (BAC) forged documents and faked social security numbers in order to foreclose on homes, The New York Post said.
Bank of America has already announced a nationwide moratorium on foreclosures while investigates the allegations.
Lenders will foreclose on about 1.2 million homes this year as high unemployment and falling house prices leave borrowers struggling to make their mortgage payments.
The investigation could be announced as soon as Tuesday.