Credit Rating FailuresThe Staff of the U.S. Securities and Exchange Commission has issued a report which uncovered problems such as failing “to adhere to their ratings policies and procedures, methodologies, or criteria, or to properly apply quantitative models,” and not disclosing when serious mistakes were made in their calculations.  On numerous occasions, two larger NRSROs and one smaller NRSRO failed to adhere to their ratings policies and procedures, methodologies, or criteria, or to properly apply quantitative models.

About this Report:  This report summarizes the examinations conducted by staff from the U.S. Securities and Exchange Commission (the “Staff”) under Section 15E(p)3 of the Securities Exchange Act of 1934 (“Exchange Act”).   This is a report of the Staff and, as such, reflects solely the Staff’s views. The U.S. Securities and Exchange Commission (“Commission”) is making this Staff report public as required by Section 15E(p)(3)(C) of the Exchange Act.

To read the full report click on this link.