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SEC Report On Credit Raters Finds Leaks And Conflicts Of Interest

Tyler Durden's picture




 

In what is perhaps the biggest face-palm moment of the day, the SEC's summary report on credit raters found 22 pages worth of supervisory failure and conflicts of interest concerns at each and every one of our NRSROs. However, perhaps the most notable headline, via Bloomberg was potentially much more litigiously serious:

*SEC SAYS `LARGE' CREDIT RATER APPEARED TO LEAK PENDING RATING

*SEC DECLINED TO IDENTIFY WHICH RATER MAY HAVE LEAKED DECISION

Now who could it be?

Further headlines, via Bloomberg,  include:

*SEC STAFF FOUND CONCERNS AT EACH OF THE NRSROS

 

The Staff is concerned that the apparently unnecessary delay in release and publication of some credit rating actions increases the possibility that pending credit rating actions will be inappropriately disseminated.

 

*SEC STAFF FOUND FAILURE IN MAKING TIMELY/ACCURATE DISCLOSURES

 

*SEC STAFF CITES SOME FAILURE TO MANAGE CONFLICTS OF INTEREST

 

But have ni fear, this will not continue:

 

*SEC DECLINED TO NAME NAMES IN CREDIT RATERS REPORT FOR FAIRNESS

 

*SEC STAFF EXPECTS CREDIT RATINGS AGENCIES TO ADDRESS CONCERNS

 

2011 Nrsro Section15e Examinations Summary Report

 

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Fri, 09/30/2011 - 11:41 | 1725987 SheepDog-One
SheepDog-One's picture

So the White House made a phone call to the SEC and said 'Take a break from your gay midget porn for a minute and put a muzzle on S&P'.

Fri, 09/30/2011 - 15:28 | 1726093 gmrpeabody
gmrpeabody's picture

Oh.., and Mary..., also make sure to have more donuts delivered, would you Dear? Thanks Hun.

Fri, 09/30/2011 - 12:10 | 1726109 Nascent_Variable
Nascent_Variable's picture

The SEC's exhaustive investigation determined that some unspecified agencies did some unspecified things wrong.  They're not going to tell anyone what happened or who did it, but they expect the agencies to try harder next time, or else they may have to release another report that gives no details or actual information.  And of course, the taxpayers get to foot the bill.

They should stick to surfing porn.

Fri, 09/30/2011 - 13:27 | 1726520 monmick
monmick's picture

Yep. You are either with us, or against us....

Fri, 09/30/2011 - 14:26 | 1726788 No One
No One's picture

Wrong. You are either with us, or suicided.

Fri, 09/30/2011 - 11:42 | 1725988 Peter K
Peter K's picture

And WHO could have this info been leaked to? :) Mr Beck, please pick up the red phone:))))))))))))))))))))

Fri, 09/30/2011 - 11:47 | 1726003 buzzsaw99
buzzsaw99's picture

small named co-conspirators and large un-named ones too. ;)

Fri, 09/30/2011 - 11:43 | 1725992 EscapeKey
EscapeKey's picture

c) All of them.

Fri, 09/30/2011 - 13:05 | 1726390 slewie the pi-rat
slewie the pi-rat's picture

L0L!!!  yep!

these "companies" were the keystonez to selling the RE financing frauds to the "innocents abroad" and now we see that they "may" be involved in leaking info of "sensitivity" >>> the "market" to >>> "insiders"? 

OMG!!!

Fri, 09/30/2011 - 13:10 | 1726426 knukles
knukles's picture

But but but....
How can it be wrong to leak inside information to insiders who by definition were already as insiders privy to the inside information?

See, there cannot be a conviction of anybody within the circle when defined as a tautology.
Brilliant.
Fucking Brilliant.

Fri, 09/30/2011 - 19:46 | 1727845 slewie the pi-rat
slewie the pi-rat's picture

don't ask, don't tell?

Fri, 09/30/2011 - 11:43 | 1725994 Blorf
Blorf's picture

Must Punish Anyone Who Downgrades America's Superbonds! Keep buying the 30 year under 3%! All is well!

Fri, 09/30/2011 - 11:44 | 1725995 fdisk
fdisk's picture

Bullish for Market.

Fri, 09/30/2011 - 11:45 | 1725999 The Fonz...befo...
The Fonz...before shark jump's picture

time for S&P to pay for its insolence....I bet you their whole board of directors gets audited by the IRS

 

First comes Fraud

 

then comes Force

Fri, 09/30/2011 - 13:06 | 1726403 knukles
knukles's picture

And then we get to the great anal sex!
S'all Greek to me.

(maniacal laughter)

Fri, 09/30/2011 - 11:46 | 1726000 Mongo
Mongo's picture

Spank & Prank Bitchez!

Fri, 09/30/2011 - 11:46 | 1726002 doomandbloom
doomandbloom's picture

They will soon try to have a common 'MA+++' rating on all banks....
(MA= move along)

Fri, 09/30/2011 - 11:47 | 1726006 fuu
fuu's picture

They have some pretty skilled 1 handed typists at SEC.

Fri, 09/30/2011 - 12:08 | 1726017 Smiddywesson
Smiddywesson's picture

Leaks at the credit agencies?  At least our economic data and Fed announcements aren't leaked, that would reduce market confidence.

/sarc

Fri, 09/30/2011 - 11:52 | 1726024 monopoly
monopoly's picture

Nooo!. I cannot believe this. Tyler, you have gone to far. This is America, the land of the free, the brave, the insolvent.

Fri, 09/30/2011 - 11:54 | 1726030 tawdzilla
tawdzilla's picture

"Now who could it be?"

rhymes with slandered and whores

Fri, 09/30/2011 - 11:55 | 1726032 Belarus
Belarus's picture

Everything is leaked within the coachroach hotel community. Like this is news to anyone. Everyday, the whole thing is massaged and manipulated on leaking inter connected  information only privy to the rulers of the world. Seriously. Goldman and JP Morgan and HSBC are loading up on physical metals right now: I know, it's been leaked. They indeed steal by inflation then by deflation then by printing.

This whole deflationary patch is so predicatable without QE. And you wanna bet Goldman knows when and how Ben's gonna do the next move, along with JP Morgan, as they furiously stock up on silver before the next QE? 

Thiis whole thing in unfolding to the script.  

Fri, 09/30/2011 - 12:00 | 1726054 mayhem_korner
mayhem_korner's picture

 

 

Who could it be...

(Arnold Horshack, sitting at desk with hand fully extended up) Oh! Oh! Oh! Oh! Oh! Oh!

Fri, 09/30/2011 - 12:05 | 1726066 Outlaw Of The W...
Outlaw Of The Wasteland's picture

Next crazy thing you'll be telling me is that reuters, the ft, wsj, cnbc, barron's, motley fool, cramer and bloomberg are in on the act, too.

That's just crazy talk.

Fri, 09/30/2011 - 12:03 | 1726071 Josh Randall
Josh Randall's picture

Wait until Germany gets downgraded for backing this crummy bailout deal part Inifinity -- then you will probably see stooge type rating agencies pop-up that will rubber stamp all Govt debt AAA+++ that was just downgraded by the old guard agencies.

Fri, 09/30/2011 - 12:07 | 1726083 Outlaw Of The W...
Outlaw Of The Wasteland's picture

The date and time of that headline has been scripted ahead of time and is well known to the usual suspects.

Will be used to make billions.  Rinse, wash, repeat.

Fri, 09/30/2011 - 12:07 | 1726085 PTRio
PTRio's picture

The SEC will not name the agency responsible for leaking rating information out of "fairness"? Fairness to whom? Those guilty of felonies? Right, we must be fair to felons. After all, isn't this the National Be Fair To Banking Felons Decade? After all, they run these big banks and if we upset them they might charge us for accessing our money we lend them at zero interest. Oh? They already do? Never mind.

The good news is the SEC only found twenty two pages of "supervisory failure and conflicts of interest". Heck, that much happens at pretty much every Wall Street firm every hour of every working day.

Fri, 09/30/2011 - 12:13 | 1726103 hambone
hambone's picture

No one would find this believable if it was written in a cheap dime store novel...only in our fantazy land where the most ludicrous reality is made up on the spot by the "winners" and communicated by the "talking heads" to a mindless people could this occur.

Still, you gotta believe the authors of "reality" get a pretty good laugh when they come up with some of this stuff...I feel like we're living the real world equivelant of "Giligans Island" and the "writers" are having a good laugh at our expense!

Fri, 09/30/2011 - 12:11 | 1726111 aerial view
aerial view's picture

Well surprise, surprise: credit raters charged with "leaks and conflicts of interest". Companies whose sole job is to provide independent analysis and accurate assessment of financial health cannot be trusted or relied on but can be bought and sold if the money is right. They failed miserably yet they are still in business and no one has been heavily fined or sent to prison. Don't you just love this country (if you're a powerful and wealthy crook)?!

Fri, 09/30/2011 - 12:25 | 1726192 Rainman
Rainman's picture

Financial criminal amnesty marches on ! Now let's move on to wrist slaps for the Big 4 accounting firms.

Fri, 09/30/2011 - 13:03 | 1726377 knukles
knukles's picture

And if we don't run out of time, maybe we'll get to the banks.

Fri, 09/30/2011 - 12:12 | 1726119 junkyardjack
junkyardjack's picture

It was probably leaked to Congress, it'll be another year where their portfolio vastly outstrips the market. Smartest guys in the room

Fri, 09/30/2011 - 12:13 | 1726121 undercover brother
undercover brother's picture

Nothing to see here.  Move along now sheeple....

Fri, 09/30/2011 - 12:32 | 1726223 snowball777
snowball777's picture

Moody's: Hello, sir! Yes, we're sorry to disturb you during bathtime, but we thought you might like to know...

Fri, 09/30/2011 - 12:45 | 1726282 RSloane
RSloane's picture

 I honestly don't know whether to laugh or cry, or just go have another glass of indifferent sherry.

Fri, 09/30/2011 - 13:02 | 1726370 knukles
knukles's picture

My wife is indifferent, too.

Fri, 09/30/2011 - 12:47 | 1726295 fyrebird
fyrebird's picture

The report on the leaks was leaked to the leakee by the SEC who is now doing the CYA with the FBI. BYOB.

And the world was saved from itself!

Unicorns will be shitting skittles again but beyond here there be monsters.

Fri, 09/30/2011 - 13:01 | 1726360 knukles
knukles's picture

Could it be the Church Lady?

Fri, 09/30/2011 - 13:32 | 1726536 bid the soldier...
bid the soldiers shoot's picture

Shocked, shocked etc. Part 987,650

Fri, 09/30/2011 - 13:33 | 1726541 nyse
nyse's picture

Surprise! /sarc.

Fri, 09/30/2011 - 13:46 | 1726598 Joebloinvestor
Joebloinvestor's picture

Considering the administration argued for days about the downgrade, I find the report self serving.

Like the SEC isn't involved in shenanigans.

I call this report "deflection".

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