October 21, 2011 / 12:55 PM / 9 years ago

Standard & Poor's has argued SEC should drop case

Oct 21 (Reuters) - Standard & Poor’s has argued to U.S. regulators that it should not be accused of violating securities laws in its ratings of a set of subprime mortgage-related securities, according to a public filing by S&P parent McGraw-Hill Cos Inc .

The company said that since receiving a notice from the Securities and Exchange Commission on Sept. 22 that the enforcement staff was weighing a case, S&P has presented “its position on the issues raised and why the Commission should not commence enforcement proceedings.”

The company disclosed on Sept. 26 that S&P had received a so-called Wells notice warning that the staff might urge the full commission to bring a civil action against S&P for violating federal securities laws with its ratings of a collateralized debt obligation known as Delphinus CDO 2007-1.

The package of securitized mortgages received top grades from S&P but quickly sourced.

The SEC issues Wells notices to give targets of investigations a chance to present their positions before the commission decides to make a formal case.

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