New rules proposed by the S.E.C. would, among other things, require that the issuers of bonds filled with bundled mortgages — not the ratings agencies — would have to vouch for their soundness and retain 5 percent of each bond. Law Professor Tamar Frankel, an authority on securities law and author of “Trust and Honesty: American’s Business Culture at a Crossroad,” says the proposals are reasonable.
“The rating agencies that were supposed to be the judges of risk failed, and it matters not why they did. The results were too painful for millions of people and too lucrative for the relative few. That is why the S.E.C.’s proposal is so timely and so important.”
Contact Tamar Frankel, 617-353-3773, email@example.com