Why the misdirected coverage? My guess is that we are seeing an unholy alliance of insurance regulators who would rather point the finger at unregulated credit derivatives, people who always favor more regulation as the answer to everything, and public officials who don't want people to wonder whether other staid, boring insurance companies that don't do credit derivatives might still have huge problems in their core portfolios. Since securities lending lacks the glamour of M&A or international "Master of the Universe" trading, the media is easily distracted.
Having worked in Sec Lending at Mellon/Boston Safe in the 90's when our group extended maturities in the portfolio too far, I thought no one could ever be so stupid again.