It was announced that S&P will pay the U.S. government and 19 states $1.4 billion to settle charges of impropriety. The Department of Justice accused Standard & Poors’ (S&P) of inflating the value of mortgage-backed securities between 2004 and 2007. [adsenseyu2]
S&P said Tuesday the settlement also resolves lawsuits with attorneys general in 19 states and the District of Columbia. Under the terms of the agreement, half of the settlement amount will be paid to the states and the other half will go to the federal government.
Separately, S&P will pay $125 million to California’s public pension fund to resolve claims that it was misled in three separate transactions. Illinois will receive $52.5 million.
Related article: $57.6 million for Countrywide whistleblower
It won’t solve Illinois’ pension crisis — not by a long shot — but it’s “better than nothing,” state Attorney General Lisa Madigan said Tuesday, announcing a $52.5 million settlement connected to the 2008 economic collapse.
Federal prosecutors contend S&P acknowledged misconduct on their behalf although the settlement contains no findings of violations by the company.
Federal prosecutors said they identified more than $5 billion in losses from just one set of securities that were rated by S&P between March and October of 2007.
Can we trust their recent “findings” in Greece?
Federal investigators are now reportedly turning their sights on Moody’s, the No. 2 ratings agency.
Read the full article on CNN Money.
