New York  - An ongoing investigation into the collapse of the auction-rate securities market was widened Monday to include JP Morgan Chase, Wachovia Corp and Morgan Stanley, New York Attorney General Andrew Cuomo said.

Cuomo's office sent letters to the banks Monday asking them to begin "immediate" settlement talks to resolve probes into their sales of auction-rate securities, which are typically bonds whose interest rates are reset by periodic bidding.

Last week, Cuomo's office secured landmark agreements with UBS and Citigroup that will return more than 20 billion dollars to investors across the nation.

The investigation involves at least 18 banks and is being conducted to determine how banks marketed auction-rate securities to investors before the 330 billion dollar market collapsed in February, Bloomberg financial agency reported.

Cuomo has demanded that the banks create buy back programmes for auction-rate securities and reimburse those investors who were forced to sell off their securities at below-par prices.

The largest settlement so far is by UBS, which is to pay 150 million dollars in fines and buy back 18.6 billion dollars in auction-rate securities.

Citigroup agreed to pay 100 million in fines and repurchase 7.3 billion in failed securities.

Cuomo said, "Today (Monday) we're expanding our investigation into the auction-rate securities scandal to insure investors across New York state and the nation get their money back ... we believe that when you protect the investor you also increase investor confidence, which helps the entire market." (dpa)