NEWS RELEASE

Washington, D.C. -- U.S. Sen. Amy Klobuchar will hold a roundtable discussion Monday, Oct. 12 at the University of Minnesota with Minnesota finance experts to highlight the need for reform on Wall Street to prevent another financial crisis.

It has been one year since the nation’s financial system came close to total collapse, with huge, long-established financial institutions toppling left and right, including Lehman Brothers, Merrill Lynch and Bear Stearns.

In the aftermath of the financial crisis, one key target for reform is the credit rating industry, dominated by just three firms: Fitch, Moody’s and Standard & Poor’s.  These companies are supposed to provide investors with reliable, independent judgments about the potential risks of different investments (such as mortgage-backed securities).

The financial crisis exposed numerous conflicts of interest within the credit rating industry as it was issuing deeply-flawed, over-optimistic ratings on investments.  The Securities and Exchange Commission (SEC) concluded that the conduct of the credit rating industry was a “principal underlying cause” of the financial crisis.

As a step toward reforming Wall Street, Klobuchar is co-sponsoring the Rating Accountability and Transparency Enhancement (RATE) Act.  It would provide the SEC with greater authority to regulate the credit rating industry.  It would allow investors to sue a firm that "knowingly and recklessly" fails to review key information in developing its ratings.   Klobuchar serves on both the Senate Commerce Committee and the Joint Economic Committee.

Joining Klobuchar for the roundtable discussion will be:

- Allison Davis-Blake, Dean of the Carlson School of Management
- John Gunyou, City Manager of Minnetonka and former Minnesota Finance Commissioner
- Jay Kiedrowski, Senior Fellow at the Humphrey Institute of Public Affairs and former Minnesota Finance Commissioner
- Paul Vaaler, Associate Professor of International Business, Carlson School of Management

WHEN:
10 a.m.
Monday, Oct. 12

WHERE:
Room #2-204 or 2-260
Carlson School of Management
University of Minnesota
321 19th Avenue South
Minneapolis