Document ID: SEC-2009-0531-0001
Agency: sec
Document Type: Notice
Title: Roundtable on Oversight of Credit Rating Agencies
Posted Date: 2009-04-16T04:00Z

[Federal Register: April 16, 2009 (Volume 74, Number 72)]
[Notices]               
[Page 17698-17699]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr16ap09-82]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59753; File Nos. 4-579 and S7-04-09]

 
Roundtable on Oversight of Credit Rating Agencies

AGENCY: Securities and Exchange Commission.

ACTION: Notice of roundtable discussion; request for comment.

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SUMMARY: The Credit Rating Agency Reform Act of 2006 provided the 
Securities and Exchange Commission for the first time with authority 
over credit rating agencies that register with the Commission as 
Nationally Recognized Statistical Rating Organizations (``NRSROs''). 
Most of the Act's provisions became effective in June 2007. Pursuant to 
the Act, the Commission has adopted two sets of rules, and Commission 
staff has conducted an extensive 10-month examination of the three 
largest credit rating agencies. In February 2009, the Commission issued 
a proposing release that included several proposals to further the 
Act's purpose of promoting accountability, transparency, and 
competition in the credit rating industry. The proposing release is 
available on the Commission's Web site at http://www.sec.gov/rules/
proposed/2009/34-59343.pdf.
    The Commission will host a roundtable discussion regarding the 
oversight of credit rating agencies, as it relates to both the 
Commission's pending proposals and more broadly. The roundtable will 
consist of four panels. Roundtable participants will include leaders 
from investor organizations, financial services associations, credit 
rating agencies, and academia.
    The roundtable discussion will be held in the auditorium at the 
Commission's headquarters at 100 F Street, NE., in Washington, DC on 
April 15, 2009, from 10 a.m. to 4:30 p.m. The roundtable will be open 
to the public with seating on a first-come, first-served basis. The 
roundtable discussion also will be available via webcast on the 
Commission's Web site at http://www.sec.gov. The roundtable agenda and 
other materials related to the roundtable, including a list of 
participants and moderators, will be accessible at http://www.sec.gov/
spotlight/cra-oversight-roundtable.htm. The Commission welcomes 
feedback regarding any of the topics to be addressed at the roundtable.

DATES: Comments should be received on or before May 15, 2009.

ADDRESSES: Comments may be submitted by any of the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://
www.sec.gov/spotlight/cra-oversight-roundtable.htm); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number 4-579 and/or File Number S7-04-09 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number 4-579. For comments 
specifically related to the proposed amendments, such submissions also 
should refer to File Number S7-04-09. This file number(s) should be 
included on the subject line if e-mail is used. To help us process and 
review your comments more efficiently, please use only one method. The 
Commission will post all comments on the Commission's Internet Web site 
(http://www.sec.gov/spotlight/cra-oversight-roundtable.htm). Comments 
are also available for public inspection and copying in the 
Commission's Public Reference Room, 100 F Street, NE., Washington, DC 
20549, on official business days between the hours of 10 a.m. and 3 
p.m. All comments received will be posted without change; we do not 
edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly.

FOR FURTHER INFORMATION CONTACT: Marlon Quintanilla Paz, Division of 
Trading and Markets, at (202) 551-5756, U.S. Securities and Exchange 
Commission, 100 F Street, NE., Washington DC 20549.

SUPPLEMENTARY INFORMATION: The roundtable discussion will concern the 
Commission's oversight of credit rating agencies. The panel discussions 
will focus on:
     The perspective of current NRSROs: What went wrong and 
what corrective steps is the industry taking?
     Competition Issues: What are current barriers to entering 
the credit rating agency industry?
     The perspective of users of credit ratings.
     Approaches to improve credit rating agency oversight.
    The Credit Rating Agency Reform Act of 2006 was designed to improve 
ratings quality for the protection of investors, serving the public 
interest by fostering accountability, transparency, and competition in 
the credit rating industry. The Act grants the Commission broad 
authority to examine all books and records of an NRSRO with regard to 
compliance with substantive Commission rules applicable to NRSROs, 
including rules addressing conflicts of interest and rules prohibiting 
certain unfair, coercive, or abusive practices. The Commission issued 
final rules establishing a regulatory program for NRSROs in June 2007.
    Since the passage of the Act and the implementation of the June 
2007 final rules, the Commission has used its authority to examine the 
adequacy of the NRSROs' public disclosures, their recordkeeping, their 
procedures to prevent the misuse of material nonpublic information, 
their management of conflicts of interest, and their approaches to 
preventing unfair,

[[Page 17699]]

abusive or coercive practices. On July 8, 2008, the Commission released 
findings from a 10-month staff examination of three major credit rating 
agencies. The staff examinations uncovered weaknesses in ratings 
practices and the need for remedial action by the firms to provide 
meaningful ratings and the necessary levels of disclosure to investors.
    In June and July of 2008, the Commission proposed a three-fold set 
of reforms that would address further the conflicts of interests, 
disclosures, internal policies, and business practices of credit rating 
agencies registered as NRSROs. With respect to the first set of 
reforms, in February 2009, the Commission issued final rule amendments 
to existing NRSRO rules. In conjunction with the adoption of these new 
measures, the Commission proposed an additional amendment that would 
require NRSROs to disclose ratings history information, in XBRL format, 
for 100% of all issuer-paid credit ratings determined after June 26, 
2007 (the effective date of most of the provisions of the Credit Rating 
Agency Reform Act of 2006). Finally, in February 2009, the Commission 
issued a release proposing an amendment that would require NRSROs that 
are hired by arrangers to perform credit ratings for structured finance 
products to disclose to other NRSROs (and only other NRSROs) that they 
are hired to determine credit ratings for those deals and to obtain 
from such arrangers a representation that they will provide information 
given to the hired NRSRO to other NRSROs.

     Dated: April 13, 2009.

    By the Commission.
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-8704 Filed 4-15-09; 8:45 am]

BILLING CODE 8010-01-P