Connecticut the Tip of the Iceberg: Investigate, Prosecute & Clawback! Ratings Agencies Knowingly Falsified Derivatives Ratings! Was It Collusion for Profit?

Written by Jim McGrath Thursday, 11 March 2010 11:56

PDF | Print | E-mail

IT WAS REPORTED TODAY THAT CONNECTICUT'S ATTORNEY GENERAL BELIEVES CREDIT AGENCIES PURPOSEFULLY ASSIGNED FALSE RATINGS TO JUNK SECURITES, ALL SO THEY, ALONG WITH THE BANKERS AND BROKERS, COULD MAKE A QUICK PROFIT OFF OF CHEATING THE PUBLIC.

WHAT MORE DO WE NEED TO KNOW, IN ORDER TO START CONGRESSIONAL AND CRIMINAL INVESTIGATIONS INTO THESE FINANCIAL INNOVATIONS WHICH REALLY ARE, IN PLAIN ENGLISH, FRAUD, DRESSED UP IN SOPHISTICATED WAYS, LEGITIMIZED BY COMPLEX MATHEMATICAL FORMULAS AND CHOPPED, DICED AND BAKED TOGETHER SO AS TO MAKE THEM UNENTANGLEABLE CASSEROLE? A PONZI SCHEME OR SHELL GAME BY ANYTHING OTHER NAME WOULD STINK AS BADLY!

In The Business Insider, Connecticut's Attorney General Richard Blumenthal reports that credit ratings agencies "...Moody's and S&P knowingly assigned false ratings to complex investments that pushed the country into recession..[and] ... resulting in many investors purchasing securities that contained far more risk than anticipated and that have ultimately proven to be nearly worthless," Blumenthal said.

The securities in question are complex bonds backed by pools of mortgages. Most of the mortgages were subprime loans given to customers with shaky credit history. Those investments have lost much of their value in recent years as mortgage defaults skyrocketed.

The attorney general called the ratings process "deceptive and misleading" during a news conference. He said lucrative fees Moody's and S&P received for rating the investments affected their objectivity in rating the debt. Companies issuing the investments paid Moody's and S&P to rate it.