After the Justice Department released its complaint against Standard & Poor's, the rating agency's lead attorney, Floyd Abrams, threw sand in the faces of CNBC's viewers. He made a bogus insinuation that the lawsuit was payback for S&P's downgrade of US sovereign debt on August 6, 2011.
"Is it true that after the downgrade the intensity of this investigation significantly increased? Yea," he said to David Faber. "We don't know why." He, "doesn't think anyone knows" whether the lawsuit was launched as a form of retaliation for the downgrade.
I know why the investigation ramped up when it did. And so should anyone else who has been following this story. Floyd Abrams' insinuation about the government's motivations are like Donald Trump's insinuation regarding Obama's both certificate, a passive aggressive smear.
The chronology goes like this:
May 2011: Sen. Carl Levin, whose Permanent Subcommittee on Investigations conducted and exhaustive probe of the rating agencies, makes a referral to the Justice Department.
May through August 2011: The Justice Department examines evidence provided by the Permanent Subcommittee and the Financial Crisis Inquiry Commission. Given the enormity of the evidence and exhibits (not all of which were publicly released), it would take any law office a while in order to determine how to move forward.
August 18, 2011: Twelve days after the S&P downgrade of US sovereign debt, Bloomberg reports that the Justice Department had interviewed three former rating agency employees in July.
Or you might take the other perspective, and say that I don't know for sure when and how the Justice Department ramped up its investigation. But the exact same thing could be said of Floyd Abrams. The Justice Department doesn't reveal all that is going on inside of the agency during an ongoing investigation; he would only know the tip of the iceberg.
But Abrams was very adept at launching a bogus media narrative.
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