Panel probing roots of crisis subpoenas documents from Moody’s, saying earlier request ignored

Meltdown panel subpoenas documents from Moody’s

WASHINGTON — A bipartisan panel investigating the roots of the financial crisis said Wednesday it has subpoenaed credit rating agency Moody’s Corp.

The Financial Crisis Inquiry Commission said Moody’s failed to provide documents it requested. It is the commission’s first subpoena.

Panel chairman Phil Angelides said the panel requested the documents on March 10, and gave Moody’s two weeks to comply.

Since the March 23 deadline, lawyers for Moody’s and the FCIC squared off over the request. More than once, FCIC lawyers prepared to issue a subpoena only to pull back.

The commission finally decided to issue the subpoena early last week.

Angelides said Moody’s did not provide any documents in response to the initial request, but had started to comply since receiving the subpoena.

The FCIC is a bipartisan group created by Congress to examine a range of issues surrounding the financial crisis. It is structured like the group that investigated the terrorist attacks of Sept. 11, 2001.

Credit rating agencies like Moody’s have been criticized for giving unrealistically high ratings to complex investments backed by risky mortgages and other assets. When homeowners started defaulting on their mortgages, the rating agencies downgraded billions of dollars of investments at once. That helped spark the financial crisis.