A European Union anti-trust investigation into the trading of Credit Default Swaps (CDS) — a type of financial insurance — has been extended to a global association of derivatives traders, the bloc’s executive announced Tuesday.

The investigation began in April 2011, looking at transactions by 16 investment banks including JP Morgan and Goldman Sachs.

The commission suspects that the banks may have colluded with Markit, the leading provider of financial information on CDS trading, to shut out other competitors from the market.

It said the investigation has now been extended to include the International Swaps and Derivatives Association (ISDA), which is involved in over-the-counter derivatives trading.

“The commission’s inquiry found preliminary indications that ISDA may have been involved in a coordinated effort of investment banks to delay or prevent exchanges from entering the credit derivatives business,” the EU’s executive wrote in a statement.

The trade in CDS — a form of insurance against a specific economic event, such as a government default — is believed by some to have exacerbated the Eurozone’s sovereign debt crisis.

The investigation has so far targeted — in addition to JP Morgan and Goldman Sachs — Bank of America Merrill Lynch, Barclays, BNP Paribas, Citigroup, Commerzbank, Credit Suisse First Boston, Deutsche Bank, HSBC, Morgan Stanley, Royal Bank of Scotland, UBS, Wells Fargo Bank/Wachovia, Credit Agricole and Societe Generale.

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