SEC fines 6 major credit rating agencies over failure to keep electronic records | Hacker News Reader

SEC fines 6 major credit rating agencies over failure to keep electronic records

cnn.com

97 pointsrntn16 comments

These are the same ratings agencies who were paid enormous sums from investment banks to give their subprime asset backed security products AAA ratings in lead up to financial crash of 2007 .... pure corruption ... I know I was boots on the ground

Here are the six. This is an article excerpt:

    Moody’s Investor Services and S&P Global Ratings agreed to pay the heftiest fines,
    a $20 million civil penalty each. Fitch Ratings agreed to pay $8 million, A.M. Best
    Rating Services agreed to pay $1 million, HR Ratings de México, S.A. de C.V. $250,000,
    and Demotech agreed to pay $100,000, respectively.

Really a pittance compared to how much these organizations turn over on a quarterly basis... but it's a good start.

... hourly basis in the case of Moodys.

It's 0.3% of their 2023 revenue. It's proportional to a $360 fine to a person who makes $120K. Not even remotely deterring. I'd be surprised if they even noticed it was gone.

It's a speeding ticket, might be enough to make the company think twice.

Companies should be fined for keeping electronic records of personal data instead of paper. Enough is enough, keeping sensitive data on computers is a failed experiment and the sooner we collectively admit that, the better.

> keeping sensitive data on computers is a failed experiment and the sooner we collectively admit that, the better

In this experiment, what were the measured outcomes? They obviously don’t include lookup or storage costs; transparency; auditability or scalability.

I'll give you storage costs and scalability.

But digital does not equate to transparency. A culture of transparency equates to transparency.

Also, paper is very auditable. The term "paper trail" is not an accident and in many circumstances can be more secure and reliable than digital

> digital does not equate to transparency. A culture of transparency equates to transparency

Doesn’t equate to, yes. Enables far more by default, absolutely. The substantial plot of Erin Brockovich is essentially resolved, today, in a few minutes of searching.

I mean, there's a lot of transparency with digital records. Sometimes too much transparency.

I think you can just omit the "instead of on paper". The more companies that don't store personal data, the better. What's their rationale?

These weren't personal data. They were business records. They didn't specify but it might be things like who was accessing what and when.

They gave at least one example of the type of records they failed to maintain:

> For example, Moody’s Ratings Employees – including at the senior level – were communicating about credit ratings activities via text messages and WhatsApp on their personal devices, according to an SEC order. That included an associate managing director making off-channel comments about credit rating clients.

This is part of the larger SEC crackdown on personal device communications. They've already collected billions from banks and other firms:

https://www.nytimes.com/2023/08/08/business/banks-fines-what...

What does this have to do with the OP?

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