Standard & Poor’s Threatened By DOJ with Civil Lawsuit

Posted by Joachim Bartels | Feb 5, 2013 | McGraw-Hill, Rating Services, S&P, Uncategorized, United States | 0 |

Standard & Poor’s says the civil lawsuit threatened by the Department of Justice (DOJ) is without legal merit and unjustified and it will vigorously defend against erroneous claims regarding U.S. CDO ratings from 2007.

One wonders why the DOJ waited more than five years to contemplate legal action and at a point when most legal cases against the ratings agencies have been dismissed. In essence the DOJ now blames the rating agencies for the subprime credit crisis!

Following the announcement the shares of McGraw-Hill dropped US$8. Moody’s shares lost US$6.

McGraw-Hill Companies, Inc. disclosed that the Civil Division of the United States Department of Justice (“DOJ”) has informed the Company that it intends to file a civil lawsuit against S&P focusing on its ratings in 2007 of certain U.S. collateralized debt obligations (“CDOs”). The news made headlines in major media across the globe.

Source: McGraw-Hill Press Release

About The Author

Joachim Bartels

Joachim C Bartels is a co-founder, director, head of information resources and Editor-in-Chief of BIIA. In his capacity as Editor-in-Chief he is responsible for the selection of relevant information content concerning industry insights, trends, technological developments, standards and policies impacting BIIA members in particular and the business information industry in general.

The BIIA library is approaching 10,000 news items and best demonstrated practices. BIIA members receive regular news alerts on key developments in the industry and the regulatory environment. The BIIA readership is widespread: between 4 to 5 thousand unique visitors access BIIA.com per month.