Story by 89 WLS reporter Bill Cameron
The Feds and more than a dozen states have filed suit against Standard & Poor's for helping cause the collapse of the economy and Illinois Attorney General Lisa Madigan was on hand in Washington for the announcement.
Lisa Madigan was on hand because she's already filed suit against S&P in Cook County circuit court. She backed up the new lawsuits claim that S&P lied about its objectivity and independence when it gave high ratings to risky mortgage investments before the housing market crash.
Attorney General Lisa Madigan said, "Quite frankly, S&P was a trigger for the destruction of our economy. While big banks and lenders built mortgage-backed bombs, it was S&P's faulty ratings that detonated them."
S&P denies any wrongdoing and claims the people who issued high ratings thought they were on the square at the time.
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CHICAGO (AP) - Illinois Attorney General Lisa Madigan says the federal lawsuit against Standard & Poor's echoes a lawsuit she's already filed.
Madigan is in Washington as officials detail a lawsuit accusing the debt rating agency of civil fraud for giving high ratings to risky mortgage bonds that helped caused the financial crisis. Several attorneys general joined the lawsuit.
Madigan filed a lawsuit against S&P last year and supported other efforts. She says S&P was a trigger for the destruction of the economy.
The government's complaint contends S&P misled investors by stating its ratings were objective. It says S&P's desire to make money and gain market share caused S&P to ignore risks posed by the investments. The alleged fraud made it possible to sell the investments to banks.
S&P denies wrongdoing.
Copyright © 2013 Associated Press