The Wall Street Journal reports, and as far as I can tell, scoops that the Justice Department is preparing to file criminal charges against mortgage-bond traders at Credit Suisse for fraud. The WSJ says two traders will plead guilty, which would be the first such convictions of the crisis.

That’s a big deal, even if I suppose we shouldn’t be surprised that, as Tom Adams notes, the charges are for defrauding their own bank and its shareholders. It’s also worth noting that it took nearly four years for Justice to get around to filing its case despite serious red flags back then:

The planned Credit Suisse charges involve alleged activity in February 2008, a month before Bear Stearns collapsed. That is when Credit Suisse suspended four traders in connection with a $2.85 billion overvaluation of asset-backed securities. The dismissal of the traders came as the Swiss-based bank said it would take write-downs of $2.85 billion, shaving $1 billion from its first-quarter earnings that year.

The Journal says it’s not known who will be charged. When I flagged this story way back in Ye Olde Opening Bell in February 2008, the Financial Times had reported that the bank’s chief of collateralized debt obligations Kareem Serageldin was one of the people suspended by the bank at the time.

The Journal says more is on the way:

In recent months, federal prosecutors and regulators have stepped up their scrutiny of the area and are preparing additional cases, people familiar with that effort say.

What’s taken so long?

Wired goes long on something called plasma gasification, which turns landfill garbage into energy, reducing the space needed for waste, while creating a new energy source.

Problem is, as Wired is wont to do when covering novel technologies like this, there’s a bit too much “gee whiz” and not enough “to be sure.” The story tracks a company that thinks it may invented a process that makes plasma gasification viable on a mass scale.

This graph is stuck down toward the bottom (emphasis mine):

The actual plant built by S4—a wholly owned subsidiary of InEnTec—is still so new that it remains to be seen whether the quality and quantity of Surma’s syngas matches the predictions and test data gathered so far. “The goal is to take waste and produce a product that is used for energy or for some other process,” says Tom Reardon, a vice president with the waste consultancy Gershman, Brickner & Bratton. “They’ve proven they can produce a syngas. But from it, can they produce the fuel they’re supposed to?”

You can write stories about startups and new technologies, of course, and this is mostly a good one. But this is kind of a giant “to be sure” to bury.

— In comments over at Felix Salmon’s blog at Reuters, ProPublica’s Jesse Eisinger responds to criticism of his and Chris Arnold’s report thatFreddie Mac is placing multibillion-dollar bets that its homeowners won’t be able to refinance their mortgages.

First, though some bloggers see nothing wrong with these trades, the FHFA did. They had them stopped. And there is a lot we still don’t know from the agency’s statement. Why did the agency stop the trades? What were its concerns about Freddie’s risk management? In all the critiques, we have seen little engagement with this FHFA statement, which essentially confirms our story, while saying that Freddie had an even greater amount of inverse floaters than we had reported.

Several bloggers, even the critics, have also agreed with the central premise of the story: That Freddie (like Fannie) has an enormous conflict of interest between helping homeowners and maintaining the value of its investment portfolios. With these trades, we wrote, Freddie exacerbated that conflict.

I liked the story but wondered whether Freddie’s position was a hedge. Eisinger argues that it probably wasn’t:

As far as the argument that perhaps these inverse floaters were used to hedge other risks in Freddie’s portfolio, bond traders we spoke with say that Freddie could have easily bought options or swaptions to hedge its prepayment and/or interest rate risk. Entering into inverse floaters as a hedge - or to offset a hedge - seemed to these traders to be cumbersome and expensive for Freddie. One said comparing inverse floaters to hedging tools is not just apples and oranges - it’s more like apples and cars. They just have nothing to do with each other.

Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at