Connecticut sues top credit rating agencies
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Wed, 30 Jul 2008 16:48:01 GMT |
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Reuters |
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NEW YORK (Reuters) - Connecticut's attorney general said on Wednesday that his office was suing the three leading credit rating agencies, saying they intentionally gave lower ratings to bonds issued by municipalities, which drove up costs for taxpayers.Moody's Corp , McGraw-Hill Cos Inc's Standard & Poor's ratings unit and Fimalac's Fitch ratings service are all named as defendants, said state Attorney General Richard Blumenthal.The firms are accused of giving municipalities artificially low credit ratings.As a result, Blumenthal said, towns, school districts, and sewer and water districts have been forced to spend taxpayer dollars to purchase bond insurance to improve their ratings, or pay higher interest costs on their lower-rated bonds.The cases are being filed in state Superior Court in Hartford, Blumenthal's office said.Moody's and Fitch, in separate statements, both said they believed the lawsuits were without merit. An S&P representative could not immediately be reached for comment.(Reporting by Martha Graybow; Editing by Lisa Von Ahn)
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