Barney Frank vs. the Credit Raters

After deftly dodging federal regulation for years, the nation’s top credit rating companies now must get past the formidable Barney Frank.

Last week, as the U.S. House debated the Wall Street reform package crafted largely by Frank, the Massachusetts Democrat quietly slipped regulations into the bill that would force the most significant overhaul of the credit rating industry to date.

By Ben Protess18 December 2009

VIDEO: Congressman: Raters Helped Create Products they Rated

Rep. Edolphus Towns, Chairman of the House Committee on Oversight and Government Reform, has led an investigation into the role the nation's largest credit rating companies played in the financial crisis. He says some raters were involved in helping create the same products they rated, and should therefore be held to a higher standard of liability. If it is proven that the credit raters were in fact grading their own work, it could affect the outcomes of dozens of investor lawsuits against credit raters worth billions. » Related Story: Courts Examine Credit Raters' 'Intimate' Relationship With Bankers

By Lagan Sebert7 December 2009

VIDEO: Will Credit Raters Dodge Change...Again?

Although the nations largest credit rating companies are blamed for underestimating much of the risk that led to the financial crisis, so far they have dodged any significant consequences. Investors lost billions of dollars on bonds awarded top ratings by Moodys, Standard & Poors and Fitch, and now Congress wants answers. But will Washington really demand change and hold the raters accountable?

By Lagan Sebert and Ben Protess
11 November 2009

VIDEO: Lawyer for Credit Rater: We're Protected by First Amendment

The nation's biggest credit rating agencies are facing blame for underestimating the risk that led to the financial crisis. Floyd Abrams is a renowned First Amendment lawyer who has represented the credit rating agency Standard and Poor's for more than 20 years. Abrams, who made his name defending the New York Times in its landmark Pentagon Papers case, told the Huffington Post Investigative Fund in an interview that raters are entitled to free-speech protections similar to those given to journalists. He is using the argument to defend S&P in billions of dollars worth of lawsuits. » Related Story: Under Attack, Credit Raters Turn to 1st Amendment

By Lagan Sebert and Ben Protess
28 October 2009