WASHINGTON -- The government's consumer finance watchdog is investigating mortgage insurance deals between banks and the insurers American International Group Inc., MGIC Investment Corp. and Genworth Financial Inc.

The three companies said in public filings this week that they had received subpoenas from the Consumer Financial Protection Bureau for information about captive mortgage reinsurance deals. They did not respond to requests for comment Friday.

Borrowers have alleged in multiple civil lawsuits that mortgage insurers paid millions in kickbacks to banks in exchange for a slice of the lenders' mortgage-insurance business.

Mortgage borrowers whose down payments are less than 20 percent typically must buy private mortgage insurance that protects the bank in case they default.

In a 2009 case filed in Pennsylvania, borrowers said Countrywide Financial Corp. encouraged them to use specific mortgage insurers. In return, they said, the mortgage insurers purchased reinsurance from a unit of Countrywide. Countrywide is now part of Bank of America.

The reinsurance deals unfairly add to people's monthly payments while offering them no direct benefit, said Adam Levitin, a visiting professor at Harvard Law School.

"There really isn't any insurance here, it's just cash going around in a loop," he said. "It's really as if you're paying a higher mortgage rate."

The CFPB's subpoenas, called Civil Investigative Demands, mean that its enforcement division has launched a preliminary probe of the matter. The investigation could result civil charges against the companies, or might be resolved without any formal action.

A spokeswoman for the CFPB said the agency does not comment on, confirm or deny activities by its enforcement team.

___

Daniel Wagner can be reached at www.twitter.com/wagnerreports.