- The Washington Times - Tuesday, February 5, 2013

The federal government has lodged a civil complaint against Standard & Poor’s, alleging the ratings agency of driving the mortgage crisis by giving high marks to risky bonds.

This is the first action related to the housing crisis taken by the government against a major ratings agency, the Associated Press reported.

S&P said that it didn’t do anything wrong — and that the government itself failed to predict the housing-market collapse. The government’s suit, however, says S&P knowingly and willfully enticed investors to mortgage bonds with shaky numbers, AP reports.

Another allegation in the suit: That S&P got sloppy with its ratings.

“Most rating committees took less than 15 minutes to complete,” the government’s lawsuit read, according to AP. “Numerous rating committees were conducted simultaneously in the same conference room,” and the general push was for S&P to keep financial firms happy, whatever the cost, AP reported.

The lawsuit was filed in U.S. District Court in Los Angeles, citing a law that requires banks to invest safely, AP reported.

Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times is switching its third-party commenting system from Disqus to Spot.IM. You will need to either create an account with Spot.im or if you wish to use your Disqus account look under the Conversation for the link "Have a Disqus Account?". Please read our Comment Policy before commenting.


Click to Read More and View Comments

Click to Hide