Wednesday, April 21, 2010

Moodys won't produce, gets a subpoena

One of the three main bond rating agencies at the heart of the Wall St. derivative fraud was reluctant to deliver some of the requested documents. This enabled the Financial Crisis Inquiry Commission to try out their subpoena power on Moody's.
It's the first subpoena issued by the Financial Crisis Inquiry Commission to compel compliance, the panel's chairman, Phil Angelides, said during a conference call with reporters. The commission faces a December deadline to produce a report documenting and explaining the causes behind the worst financial crisis since the Great Depression.

Until now, every party contacted by the commission has either complied or indicated a willingness to comply with its requests, Angelides said. Moody's -- one of the three major credit rating agencies accused of contributing, if not worsening, the financial crisis -- is the only party delaying the panel's investigation.

Angelides said the panel is after "essential documents and e-mails relevant to our investigation." He wouldn't specify what the commission is looking for. The commission first sent its request for documents on March 10, Angelides said.
I can understand Moody's reluctance. If it was my top grade rating that got everybody to pay top dollar for a mountain of manure I wouldn't want anyone to see how I did it either.

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