An investigation by the New York attorney general into Washington Mutual's role in a case of alleged real estate appraisal fraud could have broader implications for the mortgage industry.

As part of his investigation, New York Attorney General Andrew Cuomo is probing industrywide appraisal practices and whether lenders have pressured appraisers into inflating property values. Cuomo's office sees the alleged unscrupulous behavior as a catalyst for the mortgage industry meltdown, leading to home foreclosures and massive investment losses.

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