SEC Considers New Rules For Credit Rating Agencies

On January 26, the Securities and Exchange Commission (SEC) presented Congress with a 48-page report about its ongoing investigation into the function and role that credit rating agencies play in the securities market.

According to the report, federal regulators are scrutinizing allegations of unfair or uncompetitive practices by the three largest credit rating agencies, Moody’s Investors, Standard & Poor’s, and Fitch Ratings. The commission is studying ways to make the industry more open to competition. In addition, the SEC is investigating potential conflicts of interest, such as those created when issuers pay for ratings, and considering whether agencies should be required to disclose more information about their ratings decisions.

Congress directed the SEC to address the need for oversight of the credit rating industry as part of last summer’s corporate reform legislation. Credit rating agencies came under fire when the major firms were still giving good investment ratings to Enron just days before the energy-trading company filed for bankruptcy.

The SEC will issue proposed new rules after evaluating and reviewing public comment of a "concept release," which should be published in 60 days.

You may like these other stories...

Here's a CPA who truly walks the walk. On March 15, Frank Ryan, CPA, departed San Diego, California, with plans to be in Ocean City, Maryland, by July 2 to teach a course at the Maryland Association of CPAs’ (MACPA...
When Theodore J. Flynn first joined the Massachusetts Society of CPAs (MSCPA) in 1970, it was a different world and a different profession.  The "Big Eight" were still headquartered in Boston. Vietnam War...
Accountant Rickey Charles Goodrich had it a little too good. Many bean counters would kill to serve as financial guru to the likes of Pearl Jam. Goodrich was hired in 2005, and the following year, he became the CFO of Curtis...

Upcoming CPE Webinars

Jul 16
Hand off work to others with finesse and success. Kristen Rampe, CPA will share how to ensure delegated work is properly handled from start to finish in this content-rich one hour webinar.
Jul 17
This webcast will cover the preparation of the statement of cash flows and focus on accounting and disclosure policies for other important issues described below.
Jul 23
We can’t deny a great divide exists between the expectations and workplace needs of Baby Boomers and Millennials. To create thriving organizational performance, we need to shift the way in which we groom future leaders.
Jul 24
In this presentation Excel expert David Ringstrom, CPA revisits the Excel feature you should be using, but probably aren't. The Table feature offers the ability to both boost the integrity of your spreadsheets, but reduce maintenance as well.