Document Type
Book Chapter
Comments
This book chapter predates the author's affiliation with Cornell Law School. It appeared in published form as a chapter in: Robert. W. Kolb, editor, Lessons from the Financial Crisis : Causes, Consequences, and Our Economic Future, Hoboken, N.J. : Wiley, 2010.
Abstract
This book chapter explores how the three largest rating agencies, Standard & Poor’s, Moody’s Investor Service and Fitch Ratings, exploited their privileged regulatory status to profit from the booming subprime mortgage market at the expense of homeowners. These rating agencies boosted their own bottom lines and assisted predatory lenders by effectively vetoing state consumer protection initiatives. While regulators have identified enhanced investor protection regulation of credit rating agencies as a priority, future regulation must ensure that the systemic biases of the rating agency industry are no longer permitted to trump legitimate state consumer protection initiatives.
Date of Authorship for this Version
2010
Keywords
Credit rating agencies, Subprime mortgages, Predatory lending
Recommended Citation
Reiss, David J., "Rating Agencies: Facilitators of Predatory Lending in the Subprime Market" (2010). Cornell Law Faculty Working Papers. 160.
https://scholarship.law.cornell.edu/clsops_papers/160