Bloomberg News: S&P Sued by Ex-Ratings Manager for Targeting Women in Job Cuts

 

Bloomberg News Service is reporting that Rosario Buendia, a former managing director in Structured Finance at Standard & Poor’s, has sued S&P’s parent company, The McGraw-Hill Companies, for allegedly discriminating against women when it reorganized the structured ratings unit last year. Buendia’s lawsuit alleges that at least five other women in senior positions in structured finance were ousted and replaced with men. The Bloomberg story quotes McGraw-Hill spokesman Frank Briamonte as saying in a statement, “As a company recognized for treating employees fairly and valuing the contributions of its workforce, we believe this suit to be without merit and will defend against it vigorously.” According to the Bloomberg report, Buendia and her attorney, Matthew Schatz of the Schwartz & Perry LLP law firm in New York, declined to comment on the lawsuit.

Rosario Buendia (1999 photo)

Tough op-ed from former rating agency ‘md’ and a law professor

Jerome S. Fons, a former managing director at Moody’s (on “The Street” they refer to these capstone titles as “MDs”), and Frank Partnoy, a law professor at the University of San Diego, gave rating agencies a failing grade in The New York Times (“Rated F for Failure,” March 16, 2009).

No word on Fitch’s grades, or whether anyone will get detention.

Puffery when I am in court, not puffery when I am not…

Columbia Journalism Review with kudos for Bloomberg columnist Jonathan Weil’s send-up of Moody’s.

Weil’s column is here.

Basically, it centers around the unfortunate juxtaposition of Moody’s public position that it stands for “Independence. Performance. Transparency,” and its legal position as reported by Weil that

“Generalizations regarding integrity, independence and risk management amount to no more than puffery,” Moody’s said in court papers. As such, alleged “misstatements of this nature are insufficient to sustain a claim under the securities laws.”

Weil contacted Moody’s PR department which gave him a statement defending the “independence-performance-transparency” paradigm while also defending their lawyers’ dismissing that credo in court as puffery. Weil goes on:

Somehow, Moody’s statements about integrity and independence are puffery when the company is writing to a judge, yet not when its spokesman is talking to a nosy journalist.

Ryan Chittum, writing in CJR’s Audit column, brings a fine point to Weil’s arguments thus:

Moody’s defense is that the reasons the capitalist system believed in it so much that it depends entirely on it—these guys, remember, have the power of life or death over companies, and countries, when they can downgrade their debt—were just marketing hooey.

Which is true. But now they tell us?