Standard and Poor’s Rating Services resolved enforcement actions by the Securities and Exchange Commission, the New York Attorney General and the Massachusetts Attorney General by agreeing to pay aggregate penalties of US $77 million, among other sanctions—including a one-year time-out from rating certain commercial mortgage-backed securities (CMBSs). The SEC filed and settled three separate enforcement actions against S&P. One related to S&P’s handling of its methodology for rating certain types of CMBSs. The SEC charged that S&P changed its methodology in 2010 to apply a less strict standard without disclosing this in eight presale reports issued between February and July 2011. The second SEC enforcement action related to a 2012 report showing average commercial loan pool losses of approximately 20% applying Great Depression levels of economic stress. This report was issued by S&P, said the SEC, to demonstrate “the relative conservatism of its new criteria.” However, the SEC claimed this report was flawed because material assumptions were not disclosed, including that underlying data was unrelated to the Great Depression. Finally, the third SEC enforcement action related to S&P’s failure from October 2012 through January 2014 to maintain and enforce adequate internal controls regarding changes in assumptions used in reviewing certain residential mortgage-backed securities. These assumptions—which were inconsistent with assumptions described by S&P publicly, said the SEC—related to estimated losses that would be incurred if a mortgage defaulted. The Massachusetts and NY Attorneys General also fined S&P related to its “misleading public statements” regarding its methodology to rate certain CMBSs in 2011.The SEC separately commenced an administrating proceeding against Barbara Duka, who at the relevant time, was in charge of S&P’s team that published the eight presale reports related to the relevant CMBSs that were the subject to the various enforcement actions. The SEC charged that Ms. Duka “acted with scienter in connection with the false and misleading CMBS Presales, in that Duka and the CMBS Group knew that the Presales contained inaccurate data and intentionally or recklessly caused such inaccurate data to be published.” Previously, Ms. Duka filed an action in a federal court in New York seeking to enjoin the SEC from commencing the adminstrative action against her, claiming that the administrative proceeding violated her constitutional rights. That action is pending.