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S&P said to face U.S. probe on mortgages
Credit rating agency Standard & Poor's is being investigated by the U.S. Justice Department for allegedly overrating mortgage-backed securities, whose meltdown led to the 2008 financial crisis, according to a report published Thursday.
In particular, The New York Times said the government was looking into whether analysts for S&P, a unit of McGraw Hill Co., wanted to give lower ratings to the mortgage securities, but were overruled by business managers. S&P, like other ratings agencies, collects fees from issuers for rating securities.
The Justice Department declined to comment to CNN regarding the reported investigation. S&P did not immediately return comment to CNNMoney.
The report also said the Securities and Exchange Commission is also investigating S&P, and might be looking into rating agencies Moody's Corp. and Fitch Ratings, concerning mortgage securities. SEC officials had no comment to CNNMoney.
Concerns that ratings agencies overrated mortgage securities have been voiced ever since the financial crisis. But the situation is complicated politically by the fact that the report comes nearly two weeks after S&P downgraded the credit rating of U.S. debt, stripping the world's largest economy of its prized AAA status.
FULL CNNMONEY.COM STORY
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The SEC is invetigating too! That's rich! Talk about a gang of crooks. The SEC should be investigated themselves for insider trading, corruption and incompetence.
Funny how this happens AFTER the downgrade...
"Let him who is without sin cast the first stone."
Hello, LP. How are things going there. HOpe your doing well. Your looking well. Just sitting here in the land of backflow. Who needs it right? Let the tide go out and stay out. : ) Time to check my usuals and see who trying to check on me. : ) I have a good partner. What happend to gadget?
That's amazing how this happens just after the country's credit rating is lowered. Hmmmm, what's the organization Obama was involved with during the whole mortgage boom and crisis? Oh that's right, Fannie Mae. What would our country be like if hypocrisy didn’t exist?
Strengths of the U.S. Government are basically all within the military powers, funded by Federal Government, and the Federal Government is the largest US employer, over time contributing to a federalized society to the point where the population is both employed controlled and in debt to Federal Government. The definition of this new form of Government and society is still evolving, but all I can tell you is that it is of humanoid android nature.
This doesn't surprise me. Chicago style politics at play?
The timing is off, but it's happening...just as everyone here wanted when S&P first downgraded the US.
Remember?
Does anyone else think this is pretty convenient timing right after S&P lowered the U.S. credit rating?? This sounds alot like the "I wash your back you stab mine" way of doing things inside the beltline... I wouldn't be at all suprised that, if these allegations are true, the government wasn't involved somehow in putting on the pressure to overrate the securities in the first place.
This should have been done long ago. Doing this so late (after our downgrade and so long after the housing crisis) will come across as pettiness, but the people at McGraw Hill are criminals who used their subsidiary S&P to knowingly inflate the ratings of bad mortgage backed securities and other financial products to sell them at a substantial profit before the bubble burst.
It does come off as pettiness, but at east it's being *done*.
Everybody knows that the wheels in DC turn very slowly, unless there is a financial benefit to be had by our Representatives in Congress.
This now creates a tremendous incentive for any rating agency not to downgrade the US. Oh brother. Stalinism in the US at work. We wont even be able to trust the rating agencies. The government is destroying the foundations of what was once a great country. Oops, oh I forgot, according to minorities and political correctness and 99 percent of churches, this never was a great country.
are you a wacko?
The Gov been started investigations before the downgrade of the US. Don't be mis-informed and the NY times broke the story.
They should investigate all credit related businesses. While they're at it, the insurance industry, too.
What about citizens? Three credit bureaus who may have different data on us (how can that happen), and it's up to us to seek out errors and challenge them?
It's a racket..
I think since the This terrorist propaganda against America took off American people are afraid to speack their mind like before. Thanks to this phenomena Americans have lost even more liberty and rights, Afterall isn't it the scope of any Government.
"the prophet" is right about the spreading fear in America to speak their mind. It's becoming a nightmare.
As for "the war" between S&P and the govt, it was the govt who, I believe, pressured or even required banks and lending agencies to give loans to really bad credit risks and those were first loans to collapse. Govt wants to shift blame to S&P.