Rating Agencies Behaving Badly: The Case of Enron
Abstract
The article examines the failure of major credit rating agencies (Moody's, Standard & Poor's, and Fitch) in the Enron scandal, highlighting their slow response to Enron's financial deterioration and their reliance on Enron's representations. It argues that while regulatory reforms are necessary, they should be approached with caution to avoid hasty, ill-considered legislation. The author emphasizes the need for a balanced approach that considers the complexities of the rating industry and its critical role in capital markets.
Fields of Study & Subjects
Credit Risk and Financial Regulations
Insurance and Financial Risk Management
Risk Management in Financial Firms
Publication details
- Journal / source
- SSRN Electronic Journal
- Publisher
- Elsevier BV
- Volume
- 35
- Publication date
- 1 January 2026
- Language
- EN
- Document type
- Preprint