SEC Could File Charges against S&P for Meltdown
The recent downgrade on Friday, of the US government by Standard and Poors to question the timing and validity of their downgrade of the full faith and credit of one of the world’s most powerful countries. The action led many to think there was something fishy going on at S&P.
If we go back to 2007 and 2008 just before the Wall Street collapse, we find the rating agency had a hand in the cover up of the real scam going on at AIG, Goldman and Bank of America at the highest possible levels, the CEO’s club of the major US banks. When the Security and Exchange Commission found the source of the derrivative scams, the credit agencies were also under scrutiny and the major rating agency was Standard and Poors.
S&P is owned by McGraw Hill was also involved on two mortgage bond transactions, and the SEC has been investigating their involvement in giving banks such as: Goldman Sachs, JP Morgan, AIG and Bank of America such glorified ratings. Perhaps that is the reason why they degraded the countries credit under Obama’s administration instead of when George Bush was President.
In 2007 the credit ratings of the banks was important to investors who felt secure in their dealings with the major banks due to the ratings, since credit rating reports are sought and used before investments or mortgage paper changes hands.
In this case, investors would never know the truth about what the banks were doing, or hiding -shall we say, and would have invested blindly and a extremely high risk. In 2010, the SEC charged Goldman Sachs Group with fraud for deceptive business practices, selling junk mortgages that were unsecured notes.
The names may change, the instruments used may differ but the crime is as old as the hills- its called Fraud, it is criminal and punishment should include deterrants like 20 years in jail.
Today S&P may face civil fraud charges for faked and phony credit ratings when they did their analysis of Goldman’s books. A credit rating agency with the reputation that S&P had in the past was all put at risk to give Goldman glowing but fraudulent reports to investors and ultimately to the SEC.
In the loft offices of Wall Street where the money is into billions of dollars, the old boyz clubs where alliances involve both political and financial backing the small tight group that wield the power are all friends.The boys play golf together, they party and vacation together and they needed each other to pull of the scam. The Credit ratings agency had to be a part of the deal, to continue the facade and give their approval and recommendations to investors.
Yes, S&P was in deep with the sub-prime mortgage meltdown and by no means should they escape punishment, fines and even some jail time.
In order to clean up Wall Street, the credit ratings companies that perpetuated the scam must also be cleaned up. The proof was in the ratings drop by S&P on Friday night. Did S&P purposefully drop the Triple A rating of the United States for the first time in history as payback for the SEC investigation and threat? Or was it a “friends of GOP” way of trying to make President Obama look bad?
Funny, there are no black CEO’s on Wall Street.
Mainly there is no trust in the United States due to the corruption of major banks, Wall Street investments and now the credit rating agencies. It is of no wonder that the US financial system is insecure and carries a big Caution sign for investors.
It is S&P’s credibility on the line especially after the disagreement they had with the US Treasury that S&P were out by several billion dollars in their calculations and were incorrect in their assumptions of debt.
How could S&P give Goldman Sachs a great rating back in 2008 and still be credible?
We do know that Mr. Harold McGraw the III, who is the CEO of S&P support Mitt Romney for President. We also are aware that the republicans wish to make Obama look bad in his One Term Presidency role they have set up for him.
We also know this is another credit default swap and its a scam.
Harold McGraw-CEO of Standard and Poors- Default Credit Rating Scam
Photo: Mitt Romney just another day at the office-trying to get Obama to look bad to voters.
Mitt Romney’s personal net worth is over 300 million dollars at last count when he worked at Bain Capital his main focus was slicing up companies, firing all their employees and selling it off bit by bit for profits.
Reference: Wall Street Journal