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U.S. investigating S&P over mortgages

 

(Reuters) – The Justice Department is investigating whether Standard & Poor’s improperly rated dozens of mortgage securities in the years before the financial crisis, The New York Times reported on Thursday, citing sources familiar with the matter.

The investigation began before S&P, a unit of McGraw-Hill, downgraded the long-term U.S. debt from a AAA rating to AA-plus this month, the paper said.

In the mortgage investigation, the Justice Department has been asking about instances in which S&P analysts wanted to assign lower ratings to mortgage bonds but may have been overruled by S&P business managers, the Times reported.

Justice Department spokesman declined to comment on the story upon being contacted by Reuters. S&P did not immediately respond to phone calls seeking comment outside regular U.S. business hours.

It was unclear whether the Justice Department investigation also involves the other two ratings agencies, Moody’s Corp and Fimalac SA’s Fitch, or only S&P, the newspaper said.

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http://www.reuters.com/article/2011/08/18/us-mortgage-probe-sp-idUSTRE77H0LK20110818?feedType=RSS&feedName=topNews&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+reuters%2FtopNews+%28News+%2F+US+%2F+Top+News%29&utm_content=Google+Reader

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