The Justice Department's civil lawsuit against the credit-rating agency Standard & Poor's aims to assign responsibility for the recent financial crisis. But expectations that Wall Street will change its ways are mixed.
With its civil lawsuit against credit rating agency Standard & Poor’s, the US Justice Department is embarking on one of the most aggressive efforts yet to hold Wall Street accountable for the financial crisis.
As the government's first crackdown on a rating agency, the suit, filed late Monday in federal court in Los Angeles, marks a watershed moment in the investigation into the financial meltdown. It’s a bold move that the government is hoping will send a stern warning to Wall Street – and has already sent a jolt through the stock market – but one that some analysts predict will do little to change “business as usual.”
The Justice Department's lawsuit claims that S&P “knowingly, and with intent to defraud ... executed a scheme to defraud investors” by giving triple-A ratings to shoddy mortgage-backed securities that led to one of the worst financial crises since the Great Depression.
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