Pam Marron Home Lending

Feds Plan to Sue Moody’s Over Pre-2008 Securities Ratings

, as published on National Mortgage Professional.com

Friday, October 21, 2016 – 15:07

Moody’s Corp. has announced that the U.S. Department of Justice (DOJ) is planning to bring a civil complaint that charges the company with violating the Financial Institutions Reform, Recovery and Enforcement Act for its rating of residential mortgage-backed securities and collateralized debt obligations in the period before the 2008 financial crash.

According to a Bloomberg report, Moody’s revealed that it was informed of the DOJ’s plans in a September 29 letter from the department. Moody’s added that an unspecified number of state attorneys general may pursue similar claims, adding that the governmental probes into the case “remains ongoing and may expand to include additional theories.”
The DOJ offered no public comment on the report. Last year, another credit ratings agency, S&P, paid $1.5 billion to settle federal charges accusing it of improper ratings prior to the 2008 crash. S&P added that it accepted the settlement rather than deal with the “delay, uncertainty, inconvenience, and expense” of litigation.

October 24, 2016 by · Leave a Comment

About Pam

Since 1985 as a loan originator, highly experienced with automated loan approvals on DU, LP, and with USDA GUS systems, thorough knowledge and use of FHA loans including 203K rehab, conventional loans including USDA, Homepath and rehab, and VA loans. After 27 years, I STILL love this business!

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