Credit rating firms wield strong lobbying clout
WASHINGTON (AP) — The three major credit rating companies poised to decide whether to downgrade the nation's top-ranked debt standing are also spending hundreds of thousands of dollars to lobby the Obama administration over the way the government regulates them.
Moody's, Fitch Ratings and Standard & Poor's, along with S & P's parent company, McGraw-Hill, have spent a combined $1.76 million since January to lobby Congress and federal agencies, much of it aimed at new regulations. The rules are part of the massive Dodd-Frank overhaul of the financial industry.
Critics worry about the potential for conflicts of interest posed by the firms' dual lobbying and rating roles as they get ready to set new values for U.S. Treasury bonds. Lowering U.S. credit ratings could shake the financial system.