Some credit-rating agencies failed to disclose ratings method changes or were lax in following policies on timely downgrades of securities, according to a report issued by U.S. securities regulators on Thursday.
The Securities and Exchange Commission summarized the results of its annual examination of raters, a requirement under the 2010 Dodd-Frank Act that called for greater scrutiny of ratings agencies following the 2007-2009 financial crisis.
The largest ratings firms, Moody's Corp and McGraw-Hill Cos Inc's Standard & Poor's, have been criticized for helping to exacerbate the crisis by giving rosy ratings to subprime mortgage securities that quickly turned toxic.
Thursday's SEC report does not name which firms had violations, but does distinguish between larger versus smaller credit-raters.
The SEC's exams were conducted on site at all nine raters registered with the SEC, which include smaller firms like Egan-Jones, as well as the big three - Moody's,
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