"The principle of rating agencies should be based on an objective and impartial position, rather than an incentive mechanism for market share.pbtt"

As expected, Eric Khinsky directly pointed his finger at the entire rating system as soon as he spoke. "Institutions packaged their assets into rating agencies and used the method of paying part of the fees to rating credit ratings. In my opinion, this practice is wrong and a misplaced incentive method."

"It is obvious that this kind of behavior that values ​​quantity but not quality, and pays attention to short-term interests rather than long-term interests may be popular among investment banks, but it is not suitable for rating agencies that are authoritative and affect the entire market. In Moody's, this motivation is reflected in the pursuit of market share."

"I have to admit that it is precisely because I insist on a more conservative and secure rating method that Moody's competition in the subprime loan-derived debt market has only two other companies, which has led to a sharp drop in performance. I have never understood this. I think it is this corporate culture that has led to rating agencies becoming the most important accomplices in the financial crisis."

"It's not just Moody's, but also S&P, Fitch and other institutions, as far as I know, pursue the same approach. So I think there are serious problems in the rating agencies across Wall Street. The pursuit of interests and market share makes it difficult for them to maintain an objective and neutral position, resulting in a large number of inferior bonds flowing into the market that should not belong to them, and the market is filled with risks that should not have been present."

“The above is all I want to say!”

Eric Ksinsky said a big call in a silence, finally breathed a long breath, took a big sip of water calmly, and slowly calmed down his excitement.

No one in the audience spoke, only the sound of the camera shutter was clattering.

“…”

Al Fran sighed, not knowing what to say.

Eric Ksinsky said that although Al Fran achieved some of his goals, his involvement was too wide and it was already related to the basis of the entire American rating agency. In this case, even if Al Fran is determined, it is impossible to continue investigating.

Originally, he only wanted to pull the branch of Moody, but now what Eric Ksinsky has to do is to cut down the big tree of the American rating agency, which is far from what he hopes.

But seeing the other party cooperated so much, Al Fran didn't know what to say. He had to smile and nodded, which was to express his approval of the other party's attitude.

But in his heart, he was scolding the other party for being foolish.

After swinging Eric Ksinsky back, Al Fran and several other committee members whispered for a long time, then looked up and looked down. He caught a meaningful smile from Zhong Shi.

To be fair, Zhong Shi had no other intentions, he was just a little disdainful of Eric Ksinsky's remarks, but when it came to Al Fran's eyes, it turned into a ridicule of him.

How could a member of Congress be allowed to mock a Wall Street capitalist? Al Fran snorted coldly, stared at Zhong Shi and said slowly: "Pass a witness!"

"There are witnesses?"

Dean Bentner was stunned at first, then comforted himself, "The whole hearing has become a joke. Since Mr. Congressman is not giving up, then add another joke."

However, Zhong Shi was not as optimistic as him. He knew very well that the more killer the thing, the more he had to use it in the end. Everything Al Fran did in vain, and he continued to do it. Then he thought that the last thing must have a certain deterrence and lethality.

Soon, a timid young man walked out. As soon as he appeared, the cameras and cameras were aimed at him, and the sound of shutters and spotlights suddenly surrounded him. This shocked him and his face suddenly turned pale and bloodless.

After finally walking through the media surrounding him, the young man stuttered and swore amid the lawyer. Then he carefully sat half his butt on the chair.

"Witness name?"

Al Fran looked at the man's posture and sighed again, thinking that his team had found someone and could not get on the table. Even if such a person went to court, he would lose points in front of the jury because of his current performance.

Hearing the voice opposite, the young man's butt jumped up quickly as if he had a spring on his back. However, the next moment, he realized that he didn't need to stand and answer the question, but he was embarrassed to sit down again and looked at the opposite side timidly. It was not until Al Fran nodded slightly that he sat down slowly.

Of course, Al Fran was even more dissatisfied with his performance, snorted heavily, and asked again: "The name of the witness?"

"Richard Michak!"

The young man shrank his head and looked around carefully for a while. Before Al Fran lost his patience, he was sure that the other party was asking him, and he replied in a low voice.

“Witnesses have worked in the rating agency Moodyri?”

Al Fran was no longer angry, but in full view of everyone, he still had to hold back the anger in his heart and asked calmly, "Is there such a thing?"

"have!"

Richard Michak was like squeezing toothpaste. Al Fran said one thing, and he answered one thing, with no intention of confessing himself at all.

"So what department is it for?"

A hint of blush flashed across Al Fran's face, and then he took a long breath, slowly calming down the depression and irritability in his heart, and then continued to ask: "What are the responsibilities and tasks of the specific work?"

Perhaps because of the fact that the other party's tone was not good, Richard Michak finally had a little awareness and replied in a long time: "I used to work at Moody's. From 22 to 29 years, a total of 7 years. During this period, I worked as a junior analyst, senior analyst, and vice president. When I left, my final position was senior vice president of the structural products and derivatives department."

Seeing that the other party finally got enlightened, Al Fran breathed a sigh of relief, knowing that the entire hearing had finally entered his own rhythm. He was relieved and did not rush to continue interrogating, but thought about how to draw more things from this person's mouth.

"This person is also your Moody's?"

Zhong Shi was also quite surprised by the emergence of former Moody's employees one after another and couldn't help asking Dean Bentner, "What the hell are you doing? How can you get rid of traitors?"

“…”

Zhong Shi's question made Dean Bentner feel very embarrassed and didn't know how to answer. He wanted to speak several times, but in the end he still wanted to speak.

Seeing his appearance, Zhong Shi couldn't help but sigh and asked again: "What the hell is going on with this guy? What do he know?"

"a lot of!"

Dean Bentner took out his hand towel, wiped the sweat beads on his forehead, and whispered. "As he said just now, this guy should be in the vital department. Many inside stories can't avoid him, so if he really wants to speak, I'm afraid..."

He didn't continue talking, but Zhong Shi already understood the meaning.

At this moment, Zhong Shi's face darkened, and his heart became heavy.

"Witness, have you ever encountered anything you think is against your professional ethics while you were working at Moody?"

Al Fran finally thought about how to interrogate, and immediately said, "So. Whether it is against your own wishes or voluntarily, have you ever done anything you think is against your professional ethics during Moody's time?"

“…”

After whispering to the lawyer for a while, Richard Michak finally spoke, "Yes!"

Naturally, his words caused an uproar in the audience. People began to whisper and discuss each other regardless of the discipline of the venue. The camera and the camera started to move wildly and attack Richard Michak overwhelmingly.

His words almost determine Moody's fate and are also the big news that journalists have been waiting for for a long time. Therefore, as soon as he finished speaking, a playful smile appeared on Al Fran's face.

"If you ask the witness to give a detailed explanation of what the specific situation is!"

He waved the gavel twice to stop the noise in the venue. He then struck while it was hot, "Speak out everything you know."

"Yes, Mr. Chairman!"

After receiving the attorney’s reimbursement, Richard Michak seemed to have given up, and said calmly, “My job is to rate the structural and derivatives issued by investment banks and banks. The method used is Moody’s internal evaluation model. I won’t talk about the specific principles, this is a very complex model.”

"There were several times when some customers sent their products to evaluate, the grade evaluated according to this model was aa-level, but when it was finally sold, it was aaa-level, that is, the highest level. This happened not once or twice, which made me very strange."

"Since you have noticed the problem, have you not taken the corresponding measures?"

Al Fran was almost ecstatic at this moment, and finally let him catch Moody's handle. He immediately followed the other party's words and continued to ask, "You should also know that this is not in line with professional ethics, right?"

"Yes, Mr. Chairman!"

Richard Michak paused and continued to answer, "After I discovered the problem, I reported to my superiors as soon as possible. But strangely, after that, I was excluded from the product evaluation of these customers. Until I left the company, this situation did not improve."

"you mean……"

Al Fran almost applauded Richard Michak. He barely suppressed the continuous ecstasy of his whole body and continued to ask, "What do you mean is there some ulterior insider trading in this process, or is it a transgression that exceeds professional ethics?"

"I haven't said that!"

After whispering to the lawyer for a while, Richard Michak finally gave a negative answer, but then he added, "According to my personal guess, something may happen in private, otherwise they would not have hidden it from me as the person in charge."

"Okay! OK! OK!"

Al Fran shouted three times in a row and continued to ask, "There is another question now. What organizations do you have in these customers?"

“Goodman, Swiss Bank and Merrill Lynch!”

Richard Michuck replied directly to this question without thinking. Then he realized something and added, "It's not called Merrill Lynch now, but Merrill Lynch Group."

"You can go down!"

His answer made Al Fran feel very satisfied, satisfied that there were 108,000 pores all over his body, and none of them did not cheer, finally made him catch Moody's handle. If it weren't for the serious hall, he would have cheered.

"It's bad now!"

When Richard Michach began to tell the story, Dean Bentner began to tremble all over his body. When the other party said it in the end, his whole body trembled like a sieve, and even sitting became a problem.

“Relax!”

Seeing his appearance, Zhong Shi couldn't help but pat the other person gently and comforted him, "Don't worry, the matter is far from the end!"

It was strange to say that, and I didn't know what magic power there was on Zhong Shi's hand. Just slapped so lightly, Dean Bentner's body suddenly calmed down. (To be continued.)
Chapter completed!