US launches a “study” into conflicts of interest
US lawmakers gave a reprieve to credit-rating agencies including Moody's and Standard & Poor's by droping measures to curb they way they work and launching a study instead, Reuters reports.
Credit-rating firms were criticised for giving strong ratings to firms and debt offerings that then caused the 2007-2009 financial crisis. The alleged conflict of interest is that the firm getting rated pays the credit-rater.
Instead of a clearing house to allocate credit ratings, the issues will be now be studied in detail before politicians make a decision. Credit rating firms shares rose on the news.
Websites
