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Several Wall Street firms have been subpoenaed by New York state prosecutors seeking information related to the packaging and selling of debt linked to risky mortgages, according to a published report Wednesday.

The office of New York Attorney General Andrew Cuomo has sent subpoenas to request information from several Wall Street firms, including Merrill Lynch & Co.  (MER:Merrill Lynch & Co.), Inc The Wall Street Journal reported, citing people familiar with the matter.

 Prosecutors in a broader investigation of the mortgage business are looking into how well the banks examined the quality of mortgages before packaging them into products sold to investors, the report said. The probe also focuses on how the debt was pooled into securities, including banks' arrangements with credit-rating firms, the newspaper reported.
Ratings companies are also under pressure after asset-backed securities that were rated investment grade plunged in value as a result of the turmoil on credit and mortgage markets.

Banks and lenders often package pools of mortgages, create securities from them and sell them to other investors, rather than keeping them on the balance sheet.

Where the next shoe will drop in the subprime mess has been difficult to anticipate partly because the securities were so widely held.

The New York AG's probe appears to be focusing on the relationships between mortgage companies, third-party due-diligence firms, securities companies and credit-ratings companies, The Wall Street Journal reported.