A lawsuit by the Justice Department would be the first action since the financial crisis against a ratings company by a law enforcement agency. It would follow several other high-profile mortgage fraud cases against other key players in the financial crisis, including Bank of America and Morgan Stanley.
S&P, Moody's and Fitch have long faced criticism from investors, politicians and regulators for assigning high ratings to thousands of subprime and other mortgage securities that quickly turned sour. This lawsuit is significant because it could augur future government action or, even worse for the agencies, more litigation by investors," said Jeffrey Manns, a law professor at George Washington University in Washington, D.C.A civil case involves a lower burden of proof than a criminal case would, and could make it easier for investigators to uncover potential "smoking guns" through subpoenas, he added.The New York Times reported that talks between the Justice Department and S&P broke down last week after the government sought a settlement of more than $1 billion.
I think what pis!@3 me off the most is no one will be prosecuted criminally in the sub-prime debacle - you can see the trend taking place. Just pay the fines and we will sweep it all under the rug.
These firms knew exactly what they were dong when assigning higher ratings to junk investments.
The only folks who will ever suffer are the homeowners, the investors, the taxpayers, and the American economy at large. The jerks responsible who took STOLE our "forced on the American taxpayer" bailout monies , with the too big to fail crap, then had the nerve to reward bad behavior by using our tax payer dollars for exec bonuses, junkets to islands , raises etc.. rather than ease the pain by offsets for investors
They still have not learned their lessons. They continue to operate like the wild west to this day, like nothing ever happened. Scumbags. They will pay the fine, (chump change) and no one will ever be criminally prosecuted, and the little guy is left to pick up the pieces for themselves. I'm sure taxpayers are just a punchline to a joke during their annual Polo Match discussions.
