Ratings lawsuits against Moody's, S&P settled

Lawsuits against Moody's, Standard & Poor's and Morgan Stanley over debt ratings settled

Associated Press

NEW YORK (AP) -- Ratings agencies Standard & Poor's, Moody's and investment bank Morgan Stanley have settled two lawsuits dating back to the financial crisis that accused them of hiding risky investments.

The lawsuits from King County in Washington state and Abu Dhabi Commercial Bank claimed that the ratings agencies and Morgan Stanley hid the risk of investing in a fund that purchased bonds backed by subprime mortgages.

Judge Shira Scheindlin dismissed the lawsuits, in federal court in New York on Friday, with prejudice. This means they can't be filed again.

Spokesmen for the McGraw-Hill Cos., which owns S&P, Moody's Corp. and Morgan Stanley confirmed the settlements. The companies are not disclosing terms.

McGraw-Hill spokesman Jason Feuchtwanger says the cases were settled without any admission of liability or wrongdoing.

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