The settlement resolved an investigation of allegations that Moody’s Corporation, Moody’s Investors Service, Inc., and Moody’s Analytics, Inc. misled investors when it rated structured finance securities leading up to and through the 2008 financial crisis. Structured finance securities, are complex investments that derive their value from the monthly payments on underlying debt instruments, such as consumer mortgages.
Indiana’s share of the nearly $864 million multi-state settlement will go toward consumer and investor protection and related purposes. In addition to the monetary settlement, Moody’s entities have agreed to significant compliance terms to ensure they conduct their ratings activities independently and objectively – including an annual certification by the CEO of Moody’s Corporation, which will be provided to Indiana every year for the next four years, certifying that Moody’s is following certain compliance requirements.
