Standard & Poor's headquarters in the financial district of New York on August 6, 2011. AFP PHOTO/Stan HONDA
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Ratings agency Standard and Poor's weakened its risk assessment criteria to win business and turn out high ratings on opaque debt products that started to unwind during the global financial crisis, an Australian court heard Monday.The U.S.-based ratings agency is being sued for at least 190 million Australian dollars ($150 million) by two local governments and two pension funds in Australia, which lost money on synthetic collateralized debt obligations (SCDOs) when the U.S. subprime mortgage crisis hit a decade ago.The class action suit, funded by Singapore-based Litigation Capital Partners, could expose S&P to lawsuits from other investors if the agency is found to have knowingly turned out unreliable ratings.In the 10 years since the global financial crisis, S&P has settled lawsuits in the U.S. over its ratings of CDOs, the products blamed for spreading market turmoil around the world.
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