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BREAKING: Atty. Gen. Holder puts $5 billion figure on mortgage-rating claim against S&P


WASHINGTON (MarketWatch) — Standard & Poor’s defrauded investors in residential mortgage-backed securities and collateralized debt obligations to the tune of more than $5 billion, Attorney-General Eric Holder said Tuesday in announcing a lawsuit against S&P and its parent, McGraw-Hill MHP -5.83% . The lawsuit brought by the Justice Department was brought under the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, which allows the Justice Department to seek civil penalties equal to the losses suffered by federally insured financial institutions. “We allege that, by knowingly issuing inflated credit ratings for CDOs – which misrepresented their creditworthiness and understated their risks – S&P misled investors, including many federally insured financial institutions, causing them to lose billions of dollars….

http://www.marketwatch.com/story/holder-5-billion-in-damages-from-sp-ratings-2013-02-05?link=MW_home_latest_news

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