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Birth of a Bureaucracy: New SEC Credit Rating Agency Opens

  • By Staff Writers
  • Published: 2012-06-18

The U.S. Securities and Exchange Commission has opened a new Office of Credit Ratings to oversee Nationally Recognized Statistical Rating Organizations, commonly referred to as credit rating agencies. Thomas J. Butler, a former executive with Morgan Stanley Smith Barney, has been appointed the OCR’s first director.

Established by the Dodd-Frank Act, the OCR will conduct annual examinations of credit rating agencies and follow up with a public report. The new office will centralize oversight and annual examinations of credit rating firms. Up until now, the SEC’s Division of Trading and Markets has supervised rulemaking related to the firms, while its Office of Compliance and Examinations was responsible for examining credit rating agencies.

Butler will oversee a staff of approximately 25 lawyers, accountants, and examiners responsible for examining and monitoring the credit rating agencies. Previously, he spent 14 years at Morgan Stanley Smith Barney as a managing director and chief operating officer for the Investment Strategy, Investment Advisory, Global Investments and Public Sector Group units.

Read a PDF of the first public report regarding annual examinations of credit rating agencies here.

 

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