U.S. regulators and law enforcement officials said on Friday they are aggressively cracking down on fraud related to the financial crisis and are seeking more powers to prevent predatory lending in the future.

The FBI said it has 43 corporate fraud cases under way directly related to the financial crisis, and said they include allegations of financial statement manipulation, accounting fraud and insider trading.

The U.S. Securities and Exchange Commission told lawmakers at a House Financial Services Committee hearing that it has several investigations into subprime lenders that raise issues regarding possible insider trading, particularly before the announcement of negative news regarding the lender.

It also said the SEC is probing the timing and amount of investment banks' massive writedowns of asset values.

We are also in the process at the commission of considering what additional legislative changes may be needed to help our enforcement and examinations personnel combat fraud and wrongdoing in the market place, SEC Commissioner Elisse Walter said.

Democratic Representative Barney Frank, chairman of the Financial Services Committee, said Congress needs to know what resources are necessary to go after those who helped fuel the economic crisis.

There is in America today a justifiable level of anger at the fact that the great majority of Americans are suffering economically because of the mistakes of a relatively small number of people and of a system that was inadequate to the task, Frank said.

We cannot prosecute people for breaking rules that did not exist and one thing we need to think about is the rules we need going forward.

Federal Reserve Governor Elizabeth Duke said the Fed is working on registration requirements for residential mortgage loan originators employed by federally supervised institutions.

Many of the bad mortgage loans that are the root cause of the credit crisis were created by lenders that had little or no oversight, and regulators are seeking to assert more control over the mortgage origination process.

While the expansion of the subprime mortgage market over the past decade increased consumers' access to credit, too many homeowners and communities are suffering today because of lax underwriting standards and other unfair or deceptive practices that resulted in unsustainable loans, Duke said.

The U.S. Department of Justice urged lawmakers to support pending legislation that would expand the definition of financial institution to include mortgage lenders for fraud prosecution.

Rita Glavin, acting assistant attorney general for the criminal division of the DOJ, said the department is working with the inspector general of the Treasury Department's $700 billion Troubled Asset Relief Program to protect taxpayer money.

The department is well aware that when large investments of taxpayer money are doled out over a short period of time, people will try to exploit the system and criminally profit, Glavin said.

(Editing by Dave Zimmerman)

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