US Sues S&P For Inflated RMBS Ratings That Fueled Crisis

Law360, New York (February 5, 2013, 12:57 PM EST) -- U.S. Attorney General Eric Holder announced Tuesday that the government is suing Standard & Poor's Financial Services LLC, alleging it knowingly inflated ratings on residential mortgage-backed securities in order to increase its own profits, a practice that contributed directly to the 2007 financial crisis.

The U.S. Department of Justice's complaint, filed Monday in California federal court, claims fraudulent ratings that S&P slapped on RMBS and collateralized debt obligations between March 2007 and October 2007 alone resulted in more than $5 billion in losses to federally insured...
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