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Rating Agencies and Reputational Risk

Maryland J. Business & Tech. Law, Vol. 4, p. 295, 2009

Brooklyn Law School, Legal Studies Paper No. 136

10 Pages Posted: 12 Mar 2009 Last revised: 12 Sep 2011

David J. Reiss

Brooklyn Law School

Date Written: March 12, 2009

Abstract

This essay is a lightly-edited version of a talk given at the University of Maryland School of Law and the Journal of Business & Technology Law's Conference on the Subprime Meltdown in October 2008. It briefly reviews the reputational risk literature and applies it to the rating agency industry. In particular, it looks at three of the inputs into reputation - trust, transparency, and leadership - and evaluates how rating agencies fared in the period leading up to the subprime meltdown. It concludes that rating agencies did poorly when it came to all three of these reputational inputs.

Keywords: rating agencies, securitization, subprime, cdo, reputation, scandal, trust, transparency, leadership, mortgage-backed securities

Suggested Citation

Reiss, David J., Rating Agencies and Reputational Risk (March 12, 2009). Maryland J. Business & Tech. Law, Vol. 4, p. 295, 2009; Brooklyn Law School, Legal Studies Paper No. 136. Available at SSRN: https://ssrn.com/abstract=1358316

David J. Reiss (Contact Author)

Brooklyn Law School ( email )

250 Joralemon Street
Brooklyn, NY 11201
United States

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