A billion-dollar settlement stemming from allegations that Standard & Poor’s Financial Services LLC misled investors in the lead up to the 2008 financial crisis will net Indiana $21.5 million.
The U.S. Department of Justice, the District of Columbia and 19 states reached a settlement agreement on state and federal complaints that S&P allegedly allowed its analysis in rating structured finance securities to be influenced by its desire to earn lucrative fees from its investment bank clients. The lawsuits, which say the alleged misconduct began as early as 2001, also allege S&P knowingly inflated the credit ratings of toxic assets packaged and sold by Wall Street investment banks.
Structured finance securities backed by subprime mortgages were at the center of the 2008 finance crisis. The Indiana Attorney General’s Office filed the lawsuit against S&P in June 2013 on behalf of Secretary of State Connie Lawson’s office, alleging S&P violated the Indiana Uniform Securities Act.
Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Idaho, Illinois, Iowa, Maine, Mississippi, Missouri, New Jersey, North Carolina, Pennsylvania, South Carolina, Tennessee and Washington as well as the District of Columbia also are a part of the settlement.