US probes Moody's over mortgage ratings: report

PUBLISHED ON FEB 2, 2015 8:04 AM

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A screen displays Moody's ticker information as traders work on the floor of the New York Stock Exchange on Jan 20, 2015. US authorities are investigating the credit rating agency over its glowing assessments of mortgage deals in the runup to the 2008 financial crisis, The Wall Street Journal reported Sunday. -- PHOTO: REUTERS

NEW YORK (AFP) - US authorities are investigating the credit rating agency Moody's over its glowing assessments of mortgage deals in the runup to the 2008 financial crisis, The Wall Street Journal reported Sunday.

Citing people familiar with the situation, the newspaper said Justice Department officials had met with several former Moody's executives. It wasn't yet clear if the probe would result in a lawsuit.

If the investigation is confirmed, Moody's would become the second major US credit-rating firm in the Justice Department's crosshairs, after a case against Standard & Poor's.

S&P is expected to within days agree to pay US$1.37 billion to settle lawsuits over its rosy grading of mortgage bonds in the financial crisis, sources told AFP.

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