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Announcing Introduction of Credit Rating Agencies Relief Act

Date: June 28, 2005
Location: Washington, DC
Issues: Finance and Banking


ANNOUNCING INTRODUCTION OF CREDIT RATING AGENCIES RELIEF ACT -- (House of Representatives - June 28, 2005)

Mr. FITZPATRICK. Mr. Speaker, every American remembers the financial hardships they faced when WorldCom and Enron went belly up. I certainly remember the broken investment accounts of my constituents and the people of Pennsylvania's 8th Congressional District. And it is extremely troubling that little known players in this crisis, Moody's and S&P, rated Enron and WorldCom at investment grade just days prior to the filing of their bankruptcies.

Two firms dominate the ratings market with SEC approval and this, Mr. Speaker, creates an uncompetitive marketplace, stifles competition from other rating agencies, lowers the quality of ratings and allows conflicts of interest to go unchecked. It is bad for the market and it is hurtful to individual investors.

Last week, I introduced the Credit Rating Agencies Relief Act of 2005, H.R. 2990, which will inject greater competition, transparency and accountability in the credit rating industry through market-based reform. I encourage my colleagues to review and to cosponsor H.R. 2990.

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