SYDNEY — Several Australian towns on Tuesday began suing Standard & Poor's for millions of dollars, claiming it misled them when rating financial products that crashed, losing them 90 percent of their investment.
The group that is funding the case said it would be the first time one of the big three agencies had appeared in court since the global financial crisis, when securities they had given top-notch ratings were proved to be worthless.
Brought on behalf of 13 Australian towns, the Federal Court case claims S&P misled investors on the quality of Constant Proportion Debt Obligation notes (CPDOs), which the US agency slapped with top-notch triple-A ratings.
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