Maine joins suit vs. Standard & Poor
Maine will join the U.S. Department of Justice, 15 other states and the District of Columbia in a civil lawsuit brought against the Standard & Poor's credit rating agency.
The lawsuit alleges the rating service engaged in unfair and deceptive practices in the rating of certain securities, which the lawsuit claims were at the heart of the nation's financial crisis, according to a press release from the Attorney General's office.
Maine's lawsuit, filed Tuesday in Kennebec County Superior Court, alleges that S&P assigned ratings with an inherent conflict of interest and that the mutual and pension funds of Maine residents were affected as a result.
The Maine lawsuit seeks civil penalties, a court order to stop and reform certain company practices and the disgorgement of ill-gotten profits that could total hundreds of millions of dollars.
The lawsuit comes after the congressional Financial Crisis Inquiry Commission found that the nation's financial crisis "could not have happened without ratings agencies such as S&P."
Reuters reported that it was not immediately clear following the Department of Justice $5 billion fraud lawsuit why federal prosecutors decided to pursue S&P instead of rival ratings agencies Moody's Corp. or Fitch Ratings, which issued similar securities ratings.
S&P on Tuesday issued a statement denying claims that it knowingly inflated credit ratings.
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