Colorado Joins S&P Fraud Lawsuit Bandwagon

(promoted by PCG)

The Associated Press (via the Houston Chronicle) is reporting that Colorado Attorney General Suthers has filed suit on behalf of the state against Standard & Poors for fraudulently inflating the ratings of risky derivatives investments in the years leading up to the Great Recession.

Colorado joins the Federal government and at least twelve other states in filing lawsuits against the ratings agency today. Colorado's suit was filed in the Denver District court.

The article claims that the Federal government seeks at least $5 billion in damages from S&P, but reports yesterday are that the government was negotiating for at least $8 billion when talks broke down. No details are provided on additional state damage amounts.

4 Community Comments, Facebook Comments

  1. These are the enablers of the recession.

    AIG and the banks were the greedy bastards who bought up all the derivatives they could find without doing due diligence, but it's the ratings agencies who provided the cover and at some points the cover-up, signaling a green light for abuse.

    And they haven't really changed, and neither have the companies that took us on the last roller coaster ride. They're still investing in derivatives, and ones that aren't much safer than the ones that got them in trouble. Unfortunately, Republicans seem intent on blocking even the vaguest hint of financial reform, so we're still on the hook for a repeat recession down the road.

  2. Danny the Red (hair) says:

    Congratulations Colorado and Suthers.  I wrote an extensive diary about this way back in 2008 and I am happy to see this.

  3. gaf says:

    But…but…the entire financial breakdown was the fault of the government!!!–not any fault to private business! Suthers has some 'splainin' to do to his fellow Republicans. He's gone off the script.

  4. The realist says:

    Where are our electeds on this? — Sen Bennet, Sen Udall, our US Reps, plus state legislators.  And the Guv.

    Just curious.

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