Saturday, 20 September 2014
Last updated 12 hours ago
Jul 11 2013 | 11:31am ET
The liquidators of two Bear Stearns hedge funds that were among the earliest victims of the credit crisis have sued the three major credit-rating agencies.
The Bear Stearns High-Grade Structured Credit Fund and a more highly-levered sister fund collapsed in 2007, costing investors some $1.6 billion and contributing to the bank's eventual fall. The funds' managers were acquitted of misleading investors and last year settled allegations leveled by the Securities and Exchange Commission.
Now, the fund's liquidators say much of the misleading was done by Fitch Ratings, Moody's Investors Service and Standard & Poor's Ratings Services, which "intentionally and knowingly misrepresented information concerning their independence, the accuracy of their ratings, the quality of their models, and the extent of their surveillance" of the mortgage-backed securities that the hedge funds bought.
Tuesday's court filing was not the liquidators' full complaint, and did not include details of their allegations. The lawsuit, brought in New York state court in Manhattan, appears designed to beat a six-year statute of limitations; the ratings agencies began to downgrade the funds' holdings in July 2007.
Both Fitch and S&P said the allegations were "without merit."
Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
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