Iowa and 18 other states are part of a settlement involving the federal government and Standard & Poor’s. Today, Iowa Attorney General Tom Miller discussed the lawsuit filed against the company by the U.S. Justice Department in the lead-up to the 2008 financial crisis.
“Standard and Poor’s played a part in that financial crisis — a significant part,” Miller said. The lawsuit accused S&P of inflating the ratings of risky mortgage investments. As part of the settlement, the state of Iowa will receive $21.5 million.
Overall, Standard & Poor’s is paying $1.375 billion to the federal government and the 19 states. Around $20 million of Iowa’s settlement will go toward seven public employee retirement funds, which collectively serve more than 425,000 members. Miller said those funds suffered substantial losses in the 2008 financial crisis as a result of the actions of Standard & Poor’s.
The Iowa Insurance Division will receive $1 million.