House Hearing to Probe Raters' Role in MF Global
January 7, 2012 12:49 PM EST
A U.S. congressional committee will hold a hearing on Feb. 2 to examine the role credit rating agencies played in the collapse of MF Global Holdings Ltd, a congressional staffer said on Friday.
Representatives of Standard and Poor's and Moody's Corp are expected to testify at the hearing, which will be held by House Financial Services' subcommittee on investigations, according to the staffer, who was not authorized to speak on the record.
Lawmakers are studying the vigilance of the ratings agencies, which did not significantly downgrade futures brokerage MF Global until just days before - or hours after - it filed for bankruptcy on October 31.
The firm collapsed after it was forced to reveal it had made a $6.3 billion bet on European sovereign debt, spooking investors and customers.
The hearing will come just over a month after Republican Representative Randy Neugebauer, the subcommittee's chairman, sent letters to Moody's Chief Executive Raymond McDaniel and Standard & Poor's President Douglas Peterson asking for detailed information about their procedures for determining MF Global's credit-worthiness.
Neither Moody's nor Standard & Poor's were immediately available for comment.
It was not immediately clear whether Fitch Ratings is part of the congressional inquiry.
(Reporting By Alexandra Alper; editing by Bernard Orr and Andre Grenon)
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