“Standard & Poor’s, found liable in November for misleading Australian towns with investment ratings, faces more lawsuits from councils and charities seeking to recoup their losses.
The city of Swan and Moree Plains Shire Council today sued S&P and its parent companyMcGraw-Hill Cos. (MHP) in Sydney federal court claiming the AAA, AA+, AA and AA- ratings given to synthetic collateralized debt obligations were misleading. The two municipalites are representative plaintiffs for about 90 councils, religous organizations and funds who aren’t named in the statement of claim.
“This filing in Australia will pave the way for further filings in Europe,” John Walker, executive director of IMF (Australia) Ltd., the litigation funder, said in a statement. “Rating agencies played a pivotal role in the misallocation of billions of dollars worldwide from 2005 to 2008 and it is important they be held accountable.”….”
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