A string of reports in recent weeks has shed light on the insular, unregulated world of so-called independent municipal financial advisers, consultants that counsel state and local governments on everything from issuing bonds and investing cash to using interest rate swaps and other derivatives.

Late last year President Obama's original choice for commerce secretary, New Mexico Gov. Bill Richardson, removed himself from consideration for the post in light of an ongoing investigation of his relationship with a financial advisory firm that received millions of dollars in compensation for work done in association with state bond issues.

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