As if the Securities and Exchange Commission didn't have enough on its plate, a new survey of corporate financial executives by the Association of Financial Professionals, Bethesda, Md., found that nearly 60% of industry pros want the SEC to take a greater role in overseeing credit rating agencies and encouraging competition in the field.
The results aren't so surprising, considering that 34% of these executives also believe their company's ratings are inaccurate, according to the survey. The results are similar to those of an AFP survey from 2002.
"We have a lot of information on credit rating agencies," said John Heine, SEC spokesman, noting the commission has issued a concept release seeking comments from interested parties on these issues. The comment period ended July 28, 2003, but Mr. Heine could not give an update.
The survey also found that 70% of respondents agree the SEC should establish and clearly communicate the criteria necessary for a credit rating agency to achieve recognized status; 91% believe the credit rating agencies should document the internal controls they have in place to protect against conflicts of interest; and 83% believe regulators should require rating agencies to document and implement policies and procedures to prevent the disclosure of non-public information.
Mr. Heine said SEC officials declined to comment on the survey results "because we haven't had a chance to review it."