Posted on 02/03/2015 9:02:57 AM PST by BenLurkin
McGraw Hill Financial, parent company of ratings agency S&P Financial Services, said Tuesday that it has reached deals it hopes will finally put to bed formal debate about its role in the collapse of the housing market and the subsequent financial crisis. Resolution will cost McGraw Hill $1.5 billion in settlements $687.5 million to DOJ, $687.5 million to settle state complaints and, separately, $125 million to California Public Employees Retirement System.
The disputes origin stretches back more than a decade to September 2004 when the Federal government claims S&P began a scheme to defraud investors that lasted until October 2007. A DOJ suit filed almost two-year to the day before Tuesdays settlement says that S&P inflated credit ratings and in turn misrepresented the risks associated with Residential Mortgage Backed Securities and Collateralized Debt Obligations in order to grow its revenue and market share.
(Excerpt) Read more at forbes.com ...
I wonder if this suit/settlement has anything to do with the recent “revenge” suit by the DOJ over the downgrade to US Tsy debt.
This suit has merit, IMO. S&P routinely overstated the quality of subprime tranches of mortgage debt and this was a big contributor to loan problems circa 2007. EVEN THOUGH S&P ratings are specifically “use at your own risk”. Overpaid idiot bureaucrats with little or no financial acumen glance at them and make snap judgements all the time.
They are protecting US from THEM..
....WAIT!....
How sure are we that this is not payback for giving the USA debt a ratings downgrade?
This is exactly what it is....Payback.
Many on FR said this was going to happen.
Of course the GOP-e sat around doing nothing.
$1.5 billion? that it??
that’s nothing.
we paid the taliban $5 BILLION to get back a traitor
(how many American men and women do you think will be maimed or killed by that money?)
The S&P had nothing to do with the real estate crash.
The DOJ has been targeting companies since 2000 who don’t play ball with the Government.
Remember the 1B Microsoft was fined for embedding Explorer in their OS.
Its still embedded but now MS backs the RATS so its ok.
They did the same thing with Intel.
Apple and Google will be next.
Just another shakedown by the lawless federal government. This is why we lose jobs every month. Companies are moving out to avoid the protection racket thugs.
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