Moody’s Investors Service Inc. says that the California Public Employees Retirement System can’t blame it for almost $800 million in losses on top-rated investments that later collapsed because its assessments are opinions and not guarantees or facts, Bloomberg News reported yesterday. Moody’s and McGraw Hill Financial Inc.’s Standard & Poor’s unit accuse CalPERS, the largest U.S. pension fund, of trying to shift responsibility for losses that occurred after it outsourced investment decisions to money managers who put $1.3 billion into three vehicles backed by subprime mortgages in 2006 and 2007. The investments crumbled amid the housing crisis. CalPERS sued the ratings companies in 2009.
