Colorado to receive $21.5M from Standard & Poor’s settlement

DENVER – Colorado Attorney General Cynthia Coffman on Tuesday announced that Colorado will receive $21.5 million as part of a settlement between 19 states and Standard & Poor’s Financial Services LLC.

The $1.35 billion settlement stems from allegations that S&P misled investors in rating securities in the lead-up to the financial crisis.

S&P was accused of repeatedly making statements emphasizing its independence and objectivity while instead allowing “its desire to earn lucrative fees from investment bank clients to influence its analysis,” the Attorney General’s announcement stated. The lawsuit also alleged that S&P assigned inflated credit ratings to toxic assets and did so knowingly.

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“Our lawsuit alleged that S&P put profit before the economic best interest of our country by claiming its ratings were objective when in fact they were not,” Coffman said in a statement. “This historic settlement at long last means S&P is being held accountable for its role in the financial crisis. I will now explore options for how Colorado’s $21.5 million can best be spent.”

In addition to the financial settlement, S&P has agreed to a statement of facts acknowledging conduct related to its analysis of securities, the AG’s office said.

Other states participating in the settlement included Arizona, Arkansas, California, Connecticut, Delaware, Idaho, Illinois, Indiana, Iowa, Maine, Mississippi, Missouri, New Jersey, North Carolina, Pennsylvania, South Carolina, Tennessee and Washington. The District of Columbia also participated.