Ernst & Young LLP may be sued for fraud as early as today by New York Attorney General Andrew Cuomo for allegedly helping Lehman Brothers Holdings Inc. mislead investors, according to a person familiar with the matter.

Cuomo will be sworn in as governor on Jan. 1. The suit would relate to Ernst & Young’s audits of Lehman financial statements aimed at downplaying its liabilities, said the person, who wasn’t authorized to speak publicly about the case. The fraud suit would be brought under the state’s Martin Act, said the person, adding that a settlement is possible.

Richard Bamberger, a spokesman for Cuomo’s office, declined to comment. Charles Perkins, a spokesman for Ernst & Young, declined to comment. The Wall Street Journal said earlier today a lawsuit might be filed this week.

Lehman, once the fourth-largest investment bank, failed in September 2008 because of risky real estate bets and too much debt including Repo 105 trades, which it tried to hide from investors, according to bankruptcy examiner Anton Valukas’s report. Valukas, in the report, said Ernst & Young could be accused of “professional malpractice” for its role as auditor.

Repo 105 transactions are a form of short-term financing that Valukas said Lehman used to move as much as $50 billion off its balance sheet temporarily to show investors it wasn’t carrying too much debt.

The U.S. Justice Department is reportedly considering whether to file espionage charges against the WikiLeaks Web site and its founder Julian Assange. The case has raised broad legal questions about how the government will protect the freedom of information and an open Internet, while also protecting privacy and national security.

It has been a big year for Internet freedom in the United States. In January, Secretary of State Hillary Clinton made freedom of expression on the Web a top foreign policy concern.

"This freedom is no longer defined solely by whether citizens can go into the town square and criticize their government without fear of retribution," Clinton said. "Blogs, emails, social networks, and text messages have opened up new forums for exchanging ideas, and created new targets for censorship."

Vice President Joe Biden defended the Obama administration for its willingness to extend tax cuts for top earners, despite earlier promises that he and the president would fight against the Bush-era policy.

"We got to the end, we couldn't get it done, and we had to make a decision," Biden said about President Barack Obama's compromise with Republicans to allow tax cuts across the income scale to continue.

The vice president told NBC's "Meet The Press" in an interview broadcast Sunday that he and Obama still believe tax cuts for the wealthiest are "morally troubling" and that they would fight to avoid renewing the cuts when they expire in 2012.

"The one target for us in two years is no longer extending the upper income tax credit for millionaires and billionaires," Biden said.

Since his campaign for president in 2008, Obama has said income tax rates should rise for single taxpayers with gross incomes over $200,000 and married couples with incomes over $250,000. His first budget, submitted a year ago, included plans for those tax increases.

With the economy still struggling, Biden said the tax-cut extensions will provide certainty to the public and to businesses, and the administration hopes they will spur hiring and growth. A more robust economy, Biden said, would allow the president to make a stronger case for eliminating the cuts for the wealthy.

Attorneys general in Arizona and Nevada filed civil lawsuits Friday against Bank of America Corp., alleging that the lender is misleading and deceiving homeowners who have tried to modify mortgages in two of the nation's most foreclosure-damaged states.

Bank of America violated Arizona's consumer fraud law by misleading consumers who tried to reduce their monthly payments to keep their homes, state Attorney General Terry Goddard said. The bank also violated the terms of a 2009 consent agreement requiring its Countrywide mortgage subsidiary to implement a loan modification program, the Arizona lawsuit alleges.

Hundreds of homeowners kept making their mortgage payments because Bank of America repeatedly assured them that their loans were being modified, Goddard said. Instead, many lost their homes anyway.

"Those people could have used that money for something else," Goddard told The Associated Press. "They were deceived into continuing to make mortgage payments when they had no hope of saving their homes."

Nevada Attorney General Catherine Cortez Masto told the AP that the Silver State's lawsuit was a last resort to try to get the bank to change its ways. It was filed after several discussions with bank managers led to assurances but little more.

"Clearly there is a disconnect between what Bank of America tells me at the management level and what's happening on the front line," Masto said.

The population continues to shift from Democratic-leaning Rust Belt states to Republican-leaning Sun Belt states, a trend the Census Bureau will detail in its once-a-decade report to the president. Political clout shifts, too, because the nation must reapportion the 435 House districts to make them roughly equal in population, based on the latest census figures.

The biggest gainer will be Texas, a GOP-dominated state expected to gain up to four new House seats, for a total of 36. The chief losers — New York and Ohio, each projected by nongovernment analysts to lose two seats — were carried by Obama in 2008 and are typical of states in the Northeast and Midwest that are declining in political influence.

Democrats' problems don't end there.

November's elections put Republicans in control of dozens of state legislatures and governorships, just as states prepare to redraw their congressional and legislative district maps. It's often a brutally partisan process, and Republicans' control in those states will enable them to create new districts to their liking.

In a statement out of Vienna, 2020 Medici — formerly known as Bank Medici — blames court-appointed trustee Irving Picard for unfairly casting blame for Madoff's fraud on the bank and Sonja Kohn.

The bank said the claims "are completely unfounded and untrue."

Last Friday, Picard filed papers in federal bankruptcy court in Manhattan saying that Kohn was in essence Madoff's "criminal soul mate."