The New York Attorney General has sued Bear Stearns over mortgage-backed securities, and of course there are dumb emails involved. | Getty Images 
 
 "Piece of shit," you've been replaced by "shit breather" in the lexicon of dumb Wall Street emails. Because if there's a Wall Street scandal, you can bet there are some dumb emails involved. 
 
 The latest example is brought to you by the lawsuit New York Attorney General Eric Schneiderman filed Monday evening against Bear Stearns (via JPMorgan Chase & Co., which purchased Bear during the crisis) alleging it knowingly stuffed mortgage-backed securities full of subprime garbage and then foisted them on unsuspecting investors. 
 
 Sure enough, there are emails. The AG's complaint says it has a bunch of emails showing how Bear Stearns employees and executives, even, were well aware of how ugly the loans they were stuffing into mortgage bonds were: 
 
 For example, according to a June 2006 internal Bear Stearns email, almost 60% of AHM loans that were purchased through the conduit were 30 or more days delinquent. After learning this information, Defendants went on to issue 
 
 over 30 subprime and Alt-A securitizations that included AHM loans. ... Other internal communications reflect Defendants’ awareness of the bad quality of loans that were being included in other securitizations. In connection with the Bear Stearns Second Lien Trust 2007-1 (“BSSLT 2007-1”) securitization, for example, one Bear Stearns executive asked whether the securitization was a “going out of business sale” and expressed a desire to “close this dog.” In another internal email, the SACO 2006-8 securitization was referred to as a “SACK OF SHIT” and a “shit breather.” 
 
 Somewhere, former Merrill Lynch analyst Henry Blodget is shaking his fist in rage: His email about touting a "piece of shit" tech stock in the dot-com bubble has now been upstaged. "Shit breather" is so much more poetic, if a little confusing. How does one breathe shit? 
 
 Anyway, in another email exchange, an underwriter at mortgage banker EMC Mortgage -- another defendant in the New York AG suit -- writes about how much pressure Bear Stearns was putting on her company to buy and securitize more loans, no matter how much shit they breathed: 
 
 I refuse to receive any more emails from [a Bear Stearns Senior Managing Director] (or anyone else) questioning why we’re not funding more loans each day. . . . [I]f we have 500+ loans in this office we MUST find a way to underwrite them and buy them. . . . I was not happy when I saw the funding numbers and I knew that NY would NOT BE HAPPY. . . . I expect to see 500+ each day. ... I’ll do whatever is necessary to make sure you’re successful in meeting this objective. 
 
 Unfortunately, the lawsuit doesn't name any names, and the complaint only offers a couple of examples. We can only hope to learn more in the days ahead. For now, you can dig into this complaint filed by Ambac last year against Bear Stearns and EMC, which seems to include many of the same allegations included in the New York AG's suit. 
 
 But so far we've already got enough emails to start carving Bear Stearns a spot in the Valhalla of dumb Wall Street emails. Blodget's there, as is former Goldman Sachs sack-of-shit chef Fabulous Fabrice Tourre. Other recent additions to the genre include a series of emails and instant messages showing traders at Barclays and RBS openly soliciting manipulation of the London Interbank Offered Rate and then having a long laugh about it. Great stuff, guys, keep it up. 
 
 Correction: An earlier version of this story incorrectly spelled the last name of Fabrice Tourre. 

 New York's top prosecutor opened a new front in efforts to hold banks accountable for the financial crisis by filing a civil lawsuit against J.P. Morgan Chase & Co., alleging widespread fraud by the company's Bear Stearns unit in the sale of mortgage-backed securities. 
 
 The case is the first to be brought under the aegis of a group of federal and state prosecutors and regulators formed by President Barack Obama in January. If successful, the lawsuit could point the way to significantly more financial pain for the big banks,... 

 Every now and then, a lawsuit or legislative report emerges to remind us just how out-of-control the U.S. mortgage business was in the years leading up to the financial crisis, and a civil tort filed today by the New York State Attorney General Eric Schneiderman is a fine example. (A congressional investigation into Countrywide’s program to provide discounted loans to lawmakers, the results of which were published in July, also comes to mind.) 
 
 Mr. Schneiderman’s suit brings fraud charges against JPMorgan with widespread misconduct in the packaging and sale of mortgage securities committed by Bear Stearns. These practices, of course, helped sink Bear Stearns, leading the investment bank to be acquired by JPMorgan in 2008, and the broad details—that Bear so coveted the profit available by selling mortgage-backed bonds that it became indiscriminate in the loans it purchased for securitization—are well known, and were common to any number of Wall Street banks. For all the ubiquity of the alleged practices, Mr. Schneiderman’s complaint still makes for a shocking read:Bear Stearns was buying junk … “… numerous originators who were top contributors to Defendants’ RMBS were on the Comptroller of the Currency’s ‘Worst Ten’ mortgage originators in the ‘Worst Ten’ metropolitan areas due to their loans’ high rate of foreclosures during the period 2005 to 2007.” 
 
 … in no small measure, because it residential mortgage-backed securities business was growing so fast … “In 2003, EMC securitized 86,000 loans valued at approximately $21 billion. That number nearly tripled in 2004, to approximately 231,000 loans valued at $48 billion. In 2005, the number jumped to approximately 389,000 loans valued at nearly $75 billion. Finally, in 2006, EMC securitized over 345,000 loans valued at $69 billion. From 2003 through 2006, EMC securitized over one million mortgage loans valued at the time in excess of $212 billion.” … and which rapid mortgage acquiring led to lapsed quality control standards … “To accommodate this massive volume of loans, Defendants’ due diligence process abandoned certain basic inquiries—such as determining the reasonableness of income in a ‘stated income’ loan. According to dozens of former due diligence firm employees and EMC underwriters, the very high volume of ‘stated income loans,’ and their limited ability to probe the reasonableness of the income stated, was one of the greatest challenges of the due diligence review.” … which was plain enough to those involved … “Defendants were aware that many of their loan originators were selling defective loans but continued to buy and securitize those loans. For example, according to a June 2006 internal Bear Stearns email, almost 60% of AHM loans that were purchased through the conduit were 30 or more days delinquent. After learning this information, Defendants went on to issue over 30 subprime and Alt-A securitizations that included AHM loans.” … even if the lapses were expedient to ignore … “Indeed, far from making an effort to improve their due diligence review—and thereby improve the scrutiny of the loans they were purchasing—Defendants, as early as February 2005, began to reduce the amount of due diligence conducted ‘in order to make us more competitive on bids with larger sub-prime sellers.’ As one senior executive acknowledged in testimony, the ‘reduction in due diligence could be a response to a request from a seller.'” … ok, we can’t resist, one more … internal communications reflect Defendants’ awareness of the bad quality of loans that were being included in other securitizations. In connection with the Bear Stearns Second Lien Trust 2007-1 (‘BSSLT 2007- 1’) securitization, for example, one Bear Stearns executive asked whether the securitization was a ‘going out of business sale’ and expressed a desire to ‘close this dog.’ In another internal email, the SACO 2006-8 securitization was referred to as a ‘SACK OF SHIT’ and a ‘shit breather.'” 
 
 Of course, Mr. Schneiderman’s lawsuit is not mere historical relic. As The Wall Street Journal points out, the suit filed today is merely the first in what could be a series of actions against the banks, and which, if successful, could lead to another round of litigation costs weighing on the lenders’ bottom lines. In the meantime, though, we can only shake our heads at another chronicle of the housing bubble.
– Today's newly filed lawsuit accuses Bear Stearns—now owned by JPMorgan Chase—of knowingly pushing rotten mortgage securities onto investors before the financial meltdown. And how might federal prosecutors go about proving it? It won't hurt that they've got Bear Stearns emails referring to one deal as a "sack of shit" and a "shit breather," reports the Huffington Post. Another shows an exec anxious to "close this dog," and yet another shows that Bear Stearns knew most of the loans it was buying and reselling were more than 30 days' delinquent. "Every now and then, a lawsuit or legislative report emerges to remind us just how out-of-control the US mortgage business was in the years leading up to the financial crisis," writes Patrick Clark at the Observer. And as the Wall Street Journal points out, if this case proves successful, it could be the first of many that seek to hold big banks accountable—brought by private investors as well as the government.