Subprime

Justice Department Sues S&P

For role in financial meltdown.

It took five years, but the U.S. government is finally going after Standard & Poor’s for its role in the financial crisis. The Justice Department, along with 16 states and the District of Columbia, is seeking $5 billion in a civil lawsuit against the ratings agency, claiming S&P defrauded investors by claiming their ratings were objective when in fact they were giving top grades to risky mortgage-backed securities. “Put simply, this alleged conduct is egregious—and it goes to the very heart of the recent financial crisis,” said Attorney General Eric Holder at a news conference announcing the charges. S&P issued a statement calling the suit meritless.