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LAWSUIT - Morgan Stanley Conspired With S&P To Inflate Ratings On $23 Billion Of Subprime Securities

This story slipped through last week, un-noticed by CNBC and other useless financial media vomit trenches.

Fraud?  You must be kidding.  There's no prosecutable fraud on Wall Street.



Morgan Stanley successfully pushed Standard & Poor’s and Moody’s Investors Service Inc. to give unwarranted investment-grade ratings in 2006 to $23 billion worth of notes backed by subprime mortgages, investors claimed in a lawsuit, citing documents unsealed in federal court.

According to the plaintiffs, the documents reveal that what the ratings companies describe as independent judgments were actually unsupported by evidence and written in collaboration with the bank that was packaging the securities. Morgan Stanley and the ratings companies deny the allegations.

“All of us were under instructions to rate everything that we could bring in the door, and they were measuring market share on a monthly basis,” Frank Raiter, a former analyst of residential-mortgage bonds at S&P, said in a deposition, according to the documents. “I wasn’t real confident we were doing a very good job at it.”




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Reader Comments (5)

Of course they conspired! I think Fraud, Conspiracy, and Extortion are now accepted, necessary components of the new business and government model in the USA. It Works well, the Sheeple have been running around in circles with their heads up their woolly butts for four years while government corruption has skyrocketed along with the salaries of the Wall Street criminals that caused the 2008 collapse. Too Big To Fail Banks have grown bigger and any legislation that would benefit the American Consumer or the Middle Class in general is ignored or gutted and buried in pork amendments before it's voted on. I think we have a bunch of Greed Infested, Morally Brain Dead Zombies running things on Wall Street and in Washington D.C. and Bleating Middle class Sheeple, Average Americans, And Poor folk are their favorite prey.
Jul 10, 2012 at 2:36 PM | Unregistered CommenterSagebrush
Well done, sage.
Jul 11, 2012 at 12:49 AM | Unregistered CommenterDailyBail
Excellent comment Sagebrush, it is all some of that good old fashioned government protected fraud. The consolidation of power is no accident either in the aftermath of the created financial scandal.
Jul 11, 2012 at 1:53 AM | Unregistered CommenterS. Gompers
The sad thing is that the people involved are reckoned to be the best and the brightest in the country, having been 'educated' at the 'elite universities', and then trained at the 'best' companies. They turned out to be biggest crooks in history having no qualms about stealing from their own grandmother.
Jul 26, 2012 at 4:48 AM | Unregistered CommenterRam2009

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