From the AP:
Wall Street’s three big credit-rating agencies are under scrutiny in Congress for their actions before the financial crisis gripped global markets.
A House oversight panel has called top executives of the three – Standard & Poor’s, Moody’s Investors Service and Fitch Ratings – to testify at a hearing on Wednesday morning. Rep. Henry Waxman, D-Calif., chairman of the House Oversight and Government Reform Committee, is holding a series of hearings on the origins of and players in the crisis, with sessions focusing on the Lehman Brothers bankruptcy, the government rescue of insurer American International Group Inc., hedge funds and the role of federal regulators.
The three agencies, which dominate the credit-rating industry, have been widely criticized for failing to identify risks in investments tied to high-risk subprime mortgages. The rating agencies have had to subsequently downgrade thousands of securities backed by mortgages as home-loan delinquencies have soared and the value of those investments has plummeted. The downgrades have contributed to hundreds of billions in losses and write-downs at major banks and investment firms – pushing the mortgage crisis into a credit and financial crisis.
House Committee on Oversight and Government Reform
10am – Hearing on the Credit Rating Agencies and the Financial Crisis
The hearing will examine the actions of the three largest credit rating agencies, Standard & Poor’s, Moody’s Corporation, and Fitch Ratings, leading up to the current financial crisis.
The following witnesses are expected to testify:
Jerome Fons, former executive, Moody’s Corporation
Frank Raiter, former executive, Standard & Poor’s
Sean Egan, Managing Director, Egan-Jones Ratings
Deven Sharma, President, Standard & Poor’s
Raymond W. McDaniel, Chairman and Chief Executive Officer, Moody’s Corporation
Stephen Joynt, President and Chief Executive Officer, Fitch Ratings