Both the Securities & Exchange Commission and New York Attorney General Eliot Spitzer are investigating Bear Stearns' CDO trading practices with clients, the market learned last week.

The SEC's Miami office is recommending enforcement action against Bear for its involvement in the pricing, analysis and valuation of some $62.9 million of CDOs it sold to one of its clients, Bear disclosed in a 10-Q filing. The investment bank also received a subpoena from the Attorney General's office asking for information related to roughly $16 million of CDOs purchased by one of its clients, according to the filing. Bear did not disclose whether the two inquiries were related.

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