The Securities and Exchange Commission (SEC) has proposed tougher regulations for credit raters. The proposal will require the Nationally Recognized Statistical Rating Organizations (NRSROs) to report internal controls to protect against conflicts of interest and establish professional standards for credit analysts. The NRSROs will also be required to publicly provide, along with the publication of the credit rating, disclosure about the credit rating and the methodology used to determine it as well as enhance their public disclosures about the performance of their credit ratings. The SEC’s proposal also asks for disclosure, concerning third-party due diligence reports for asset-backed securities.

Click here for the release from Securities and Exchange Commission.