COLUMBUS, Ohio — Ohio's Attorney General has filed suit against Moody's Investors Service, Standard & Poor's and Fitch, arguing the ratings services are responsible for costing the state's retirement and pension funds more than $457 million by giving their approval high-risk Wall Street securities that later proved nearly worthless.
In its suit, and during a press conference, Ohio Attorney General Richard Cordray suggested the ratings services were in cahoots with the banks and other issuers as part of a broader conspiracy that led to exotic financial derivatives and that contributed to the housing bubble.
"We believe that the credit rating agencies, in exchange for fees, departed from their objective, neutral role as arbiters," Cordray said during a news conference. "At minimum, they were aiding and abetting misconduct by issuers."
The Ohio litigation is just the latest to be filed against the credit rating agencies. Individual investors and others, including the enormous California Public Employees Retirement System, have also filed suit over what CALPERS called "wildly inaccurate ratings."
