Ah ha! Credit rating agencies seem to have been up to no good. There’s a big surprise. In the US, the SEC issued the findings of a 10-month report which found all three agencies – Moody’s Standard & Poor’s and Fitch Ratings had “sacrificed quality for profit” as the Journal headline put it.

The report included some email quotes such as an analyst who said the ratings model didn’t capture half the ris but “it could be structured by cows and we would rate it.” Like the journalists’ real pal, Elliot Spitzer, the SEC didn’t name the firms, much less the analysts. Damn!

No doubt some email guardian vendor will soon be offering a compliance engine to check electronic messages for “cows” and issue alerts, turn on the sirens, and set the analyst’s Aeron chair to eject mode.

Once again, as with analysts touting stocks to retail investors while disparaging them in private, the SEC missed conflicts hiding in plain view and is left to play catch-up. Perhaps it is suffering from the same problem the ratings agencies had – in a booming investment economy they can’t hire and keep enough skilled staff.

Filed under: Technology