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S&P nears settlement with NY, others over real estate bonds

Firm could face $60M-plus in fines, suspension from grading some deals

Martha Coakley and Eric Schneiderman
Martha Coakley and Eric Schneiderman

Standard & Poor’s is close to a settlement with New York, the Securities and Exchange Commission and others over an investigation of how the financial services firm graded real estate bonds.

The joint settlement with parties including New York Attorney General Eric Schneiderman and Massachusetts Attorney General Martha Coakley could be reached by next month, the Wall Street Journal reported, citing unnamed sources.

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S&P, which is headquartered at 55 Water Street, is expected to face a $60 million fine and could be suspended from rating some deals for up to a year. It is unknown whether S&P will be asked to admit wrongdoing as part of the deal, the newspaper said.

The investigation involved the handling of six commercial real estate bond ratings from 2011. [WSJ] — Mark Maurer

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Eric SchneidermanStandard & Poor’s