The controversy over Goldman Sachs' ability to charge high fees for underwriting Build America Bonds (Build America Bonds news) has been overshadowed by other news as of late.

Recall that the firm was criticized by states and municipalities who paid it "an average 37 percent more to investment banks for underwriting Build America Bonds than for handling tax-exempt sales since offerings of the subsidized taxable debt began in April." That translates into more than $100 million in added costs, which would appear to be well above corporate costs for similar services. The Senate has opened an inquiry.

Other issues include whether these bonds are priced too cheap, raising interest costs for the government, which pays 35 percent of the interest. The New York Times notes the IRS is now looking into these issues. Florida has already exited the market.

The Times also notes--no big surprise--that some banks have gone bearish on the market and are offering advice on how to short these bonds. This is an especially big deal for California and New York, the two biggest issuers of Build America Bonds. 

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