Claim: Credit rating agencies provide investors with an independent evaluation and assessment of debt securities' creditworthiness but has recently catered to issuers of securities who have become their paying customers.
Evidence: A credit rating agency (CRA, also called a ratings service) is a company that assigns credit ratings, which rate a debtor's ability to pay back debt by making timely principal and interest payments and the likelihood of default. A credit rating facilitates the trading of securities on a secondary market. Individual consumers are rated for creditworthiness not by credit rating agencies but by credit bureaus (also called consumer reporting agencies or credit reference agencies), which issue credit scores. The value of credit ratings for securities has been widely questioned. Credit rating agencies provide assessments about the creditworthiness of bonds issued by corporations, governments, and packagers of asset-backed securities. CRAs theoretically provide investors with an independent evaluation and assessment of debt securities' creditworthiness. However, in recent decades the paying customers of CRAs have primarily not been buyers of securities but their issuers, raising the issue of conflict of interest (see below).