Credit agencies being investigated over practices

Australian News.Net
Tuesday 27th May, 2008

America’s three main credit rating agencies are being looked in to by the US Securities & Exchange Commission.

The SEC is looking into the handling of the subprime crisis by all three and a report of computer errors at Moody's.

Moody's, Standard & Poor's and Fitch have been contacted by the SEC and asked for information on aspects of their methodology.

Rating agencies have come in for criticism for not giving early warning of a number of big corporate debt scandals, and also for their ratings of complex products that were hit hard by widespread defaults on US subprime mortgages and the ensuing credit market crisis.

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