More California cities could go bankrupt soon or default on bonds, Moody's Investor Service warned recently.

Moody's, one of the nation's top credit rating agencies, said some city leaders are turning to bankrupty as a new financial strategy to take on budget deficits and avoid obligations to bondholders.

Stockton, San Bernadino, and Mammoth Lakes have already filed for bankruptcy this year.

The group plans to launch a full review of California's municipal finances amid growing concerns that more bankruptcies are coming.

Moody's said the financial problems in the state could cause problems for investors who own municipal bonds.

Despite the report, Moody's did note "the vast majority of rated municipalities that are under distress in California and across the nation will not resort to bankruptcy."