Recent market failures offer the opportunity to explore regulations controlling bond ratings, the use of derivatives, and the trading of credit default swaps linked to the housing market. Despite research into the associated unethical actions involving credit rating agencies and role of the Federal Reserve Bank, researchers are still grappling with such market failures. The main research objective in this qualitative descriptive study was to analyze the roles involved with the subprime mortgage crisis in the United States. The study utilized a case study approach and found that complex derivatives, such as collateralized debt obligations and credit default swaps, played central roles during the financial meltdown. Further, the study provided useful information to policymakers, governments, economists, and financial institutions as to formulate financial reforms serving to prevent another economic catastrophe. Factors such as excessive deregulation in the derivatives industry, unethical actions of the bond rating agencies, and the actions of the Federal Reserve Bank have not been previously explored as to understand their roles within the recent meltdown in the US economy. This study addressed such a gap in the literature and provided information to future researchers wishing to study strategies for financial regulation.