Recently in Press Releases

 WASHINGTON, DC – Congressman Brad Sherman (D – Sherman Oaks) welcomed today’s announcement by Farmers Insurance CEO Jeff Dailey that the company will move its headquarters to Woodland Hills in the San Fernando Valley.  As the only Los Angeles area Congressman on the Housing and Insurance Subcommittee of the House Committee on Financial Services, Congressman Sherman is well acquainted with Farmers Insurance and the valuable services they provide to millions of Americans.

“I am pleased to welcome Farmers Insurance to the San Fernando Valley. More people working in the Valley means a more robust economy,” Congressman Sherman said.

There are currently 1,490 employees working at the Woodland Hills facility. Farmers Insurance will be moving roughly 1,400 jobs from their mid-Wilshire facility to the Valley over the next five years.

In discussing their decision to move, the company highlighted many of the benefits Valley residents know well.  With better access to the freeways, this will provide shorter commutes for a large number of their employees.  Also,with the newer facilities in Woodland Hills, Farmers will have an enhanced work environment that will help attract and retain talented Californians.

72 Members of Congress Urge State Department to Prioritize Release of Kidnapped Archbishops in Syria

Sherman, Bilirakis, Maloney, Sarbanes, Franks, and Pompeo Lead Effort in House of Representatives

Washington, DC – 72 Members of Congress, led by Representatives Brad Sherman (D-CA), Gus M. Bilirakis (R-FL), Carolyn Maloney (D-NY), John Sarbanes (D-MD), Trent Franks (R-AZ), and Mike Pompeo (R-KS), urged the State Department to prioritize the release of two kidnapped Archbishops in a letter to Secretary Kerry. 

Metropolitan Boulos Yazigi, the Greek Orthodox Archbishop of Aleppo, and Metropolitan Yohanna Ibrahim, the Syriac Archbishop of Aleppo, were abducted by unknown assailants while carrying out humanitarian work in the northern province of Aleppo on April 22, 2013.  Their driver, Fatha’Allah Kabboud, a deacon in the Syriac Orthodox Church, was shot dead.  Pope Francis has called for the release of these Archbishops.  

“I am pleased that 72 bipartisan Representatives in the House joined together in urging the Secretary of State to make this issue a priority,” said Rep. Sherman, a senior member of the Foreign Affairs Committee and a member of the International Religious Freedom Caucus. “We must do everything we can to ensure that Christians and other religious minorities have a safe future in Syria.  I am deeply alarmed about the safety of the Archbishops and call for their immediate and safe release.”

“It has been almost a month since Metropolitan Ibrahim and Metropolitan Yazigi were kidnapped,” said Rep. Bilirakis. “I am deeply concerned about their safety and demand their immediate return. These men of God faithfully served the Orthodox community during the ongoing conflict in Syria and their kidnapping highlights the troubling rise in abductions. This type of tragedy only heightens the need for the Assad regime to step aside. The United States needs to identify pro-democracy elements within Syria, so the country may work to establish a new government based on democratic institutions that promote and respect human rights and religious freedoms for all. I thank my colleagues in the House for joining us on this important letter urging Secretary Kerry to prioritize the safe return of the Archbishops to Aleppo.”

“I am deeply concerned for the safety of Metropolitan Boulos Yazigi, the Greek Orthodox Archbishop of Aleppo, and Metropolitan Yohanna Ibrahim, the Syriac Archbishop of Aleppo, who were kidnapped as they carried out humanitarian work near the Turkish border of Syria,” said Rep. Maloney. “Not only were these religious leaders abducted, but their driver, an innocent victim, was murdered by these armed individuals.  It is a travesty that weeks have gone by since the Archbishops were initially captured, and we have still heard nothing on their release.  These Archbishops have nothing to do with the Syrian civil war, and I call on their immediate and safe release.”

“The kidnapping of Metropolitan Ibrahim and Metropolitan Yazigi is part of an alarming trend of violence directed at religious minorities, especially Christians,” said Rep. Pompeo. “I am glad to be joined by 71 Members of the House of Representatives to demand the release of the Archbishops and to reaffirm our commitment to religious freedom around the world.”

“We urge the State Department to make Metropolitan Yazigi and Metropolitan Ibrahim’s immediate release and safe return to Aleppo a priority in our efforts in the region,” said the Members in the letter.  “As Members of Congress committed to religious freedom in the Middle East and around the world, we believe the United States must do everything it can to ensure that all the diverse religions and ethnicities of Syria have a safe future.”

Full text of letter:

The Honorable John Kerry

Secretary of State

U.S. Department of State

Washington, D.C. 

Dear Secretary Kerry,

We write to express our grave concern over the kidnapping of Metropolitan Boulos Yazigi, the Greek Orthodox Archbishop of Aleppo, and Metropolitan Yohanna Ibrahim, the Syriac Archbishop of Aleppo. The two Archbishops were abducted by unknown assailants while carrying out humanitarian work in the northern province of Aleppo on April 22, 2013.  We mourn the murder of Fatha’Allah Kabboud, a deacon in the Syriac Orthodox Church, who was serving as the Archbishops’ driver at the time of their abduction.

We urge the State Department to make Metropolitan Yazigi and Metropolitan Ibrahim’s immediate release and safe return to Aleppo a priority in our efforts in the region. 

Metropolitan Yazigi and Metropolitan Ibrahim had previously made public pronouncements that religious tolerance and diversity was under threat from the two-year conflict in their country. 

The kidnapping of Metropolitan Yazigi and Metropolitan Ibrahim reflects the troubling rise in abductions in Syria, the expanding chaos and brutality of the civil war that has killed more than 70,000 Syrians, and an increasingly dangerous environment for religious minorities. 

As Members of Congress committed to religious freedom in the Middle East and around the world, we believe the United States must do everything it can to ensure that all the diverse religions and ethnicities of Syria have a safe future.  

Thank you for your attention to this important matter.

Sincerely,

The Honorable Brad Sherman

The Honorable Gus M. Bilirakis

The Honorable Carolyn Maloney

The Honorable John Sarbanes

The Honorable Trent Franks

The Honorable Mike Pompeo

The Honorable Eliot Engel

The Honorable John Conyers, Jr.

The Honorable Joseph Crowley

The Honorable Peter King

The Honorable Chris Van Hollen

The Honorable Peter Roskam

The Honorable Darrell Issa

The Honorable Don Young

The Honorable Steve Israel

The Honorable Charles B. Rangel

The Honorable Walter Jones

The Honorable Chris Smith

The Honorable Carolyn McCarthy

The Honorable Nick J. Rahall, II

The Honorable Doug Lamborn

The Honorable James P. McGovern

The Honorable William Keating

The Honorable Jim Langevin

The Honorable Michael E. Capuano

The Honorable Albio Sires

The Honorable Mike Fitzpatrick

The Honorable Frank R. Wolf

The Honorable Gerald Connolly

The Honorable Peter DeFazio

The Honorable Bill Johnson

The Honorable Bill Foster

The Honorable Michael F. Doyle

The Honorable Anna Eshoo

The Honorable Justin Amash

The Honorable Jared Polis

The Honorable John A. Culberson

The Honorable Bill Huizenga

The Honorable Gary C. Peters

The Honorable Pete Olson

The Honorable Rick Larsen

The Honorable Steven Cohen

The Honorable Tim Huelskamp

The Honorable Tim Griffin

The Honorable Roger Williams

The Honorable Jim Bridenstine

The Honorable Tim Murphy

The Honorable Michael H. Michaud

The Honorable Matt Salmon

The Honorable Alan Nunnelee

The Honorable Bill Pascrell, Jr.

The Honorable Scott Garrett

The Honorable Gregg Harper

The Honorable Steven Palazzo

The Honorable Keith J. Rothfus

The Honorable Richard Hanna

The Honorable Joseph R. Pitts

The Honorable Kevin Cramer

The Honorable Andy Harris

The Honorable James Lankford

The Honorable Stephen Fincher

The Honorable Jan Schakowsky

The Honorable David N. Cicilline

The Honorable Chris Stewart

The Honorable Rush Holt

The Honorable Ted Deutch

The Honorable James P. Moran

The Honorable Leonard Lance

The Honorable Rodney Davis

The Honorable Joaquin Castro

The Honorable Grace Meng

The Honorable Lynn Jenkins

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 Sherman Oaks, CA –Congressman Brad Sherman will host a Town Hall meeting from 3:00 pm to 4:30 pm on Sunday, June 2^nd at Dixie Canyon Elementary School, located at 4220 Dixie Canyon Avenue.

The Congressman will discuss the economy, jobs, Social Security, Medicare, the budget, the deficit, immigration, the Middle East, as well as other issues facing Congress. Most of the meeting will be devoted to Congressman Sherman listening and responding to questions from Valley residents.

Sherman’s district office staff will be on hand to help constituents resolve any problems they may have with federal agencies, including the Social Security Administration and the Department of Veterans Affairs. The event, light refreshments, and parking are free.

Date: Sunday, June 2^nd

Time: 3:00 pm – 4:30 pm

Location: Dixie Canyon Elementary School

                   4220 Dixie Canyon Ave.

 WASHINGTON, DC – Today Congressman Brad Sherman (D-CA) and Senator Bernie Sanders (I-VT) reintroduced the “Too Big to Fail, Too Big to Exist Act,” in the House and Senate respectively. Under the legislation, any institution that is too big to fail will be broken up and reorganized to avoid more government bailouts and future risk to the economy. If passed, this legislation would require the Secretary of the Treasury to identify, then later break up, institutions that are deemed too big to fail to avoid the potential for a future government bailout and undue risk to our nation’s economy.

Washington, DC – Today, at a hearing on “The Rebalance to Asia: Why South Asia Matters” in the House Foreign Affairs Subcommittee on Asia and the Pacific, Congressman Brad Sherman (D-CA), warned of excessive U.S. military commitment toward the Japan-China dispute over the islands known as Diaoyu Islands in China and Senkaku Islands in Japan. 

Sherman supported the U.S. “pivot” toward the Asia-Pacific region, where nearly 100,000 U.S. troops are already deployed.  However, he warned of the costs of excess military confrontation over an island dispute.

         “Confronting China over the islands it disputes with Japan could involve many tens of billions of dollars,” said Sherman.  “Japan itself spends only a very small portion of its budget on defense.”  

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 CANOGA PARK, CA – Today, Congressman Brad Sherman (D-Sherman Oaks), a senior member of the House Financial Services Committee, received the “Friend of Affordable Housing Award” from the Federal Home Loan Bank of San Francisco for his long-standing support of affordable housing and preserving and increasing homeownership opportunities in the San Fernando Valley.  Sherman also helped announce the recipients of the Affordable Housing Program (AHP) funding competition.

“I am pleased with this honor and the partnership we have developed over the years to create much-needed affordable housing for low-income residents and veterans with families.  For nearly a decade, I have worked with the Federal Home Loan Bank of San Francisco and other partners to help increase and preserve homeownership opportunities for hundreds of Valley families,” said Congressman Sherman.

During his tenure in Congress, Sherman has been a strong advocate for legislation that increases affordable housing, advances homeownership opportunities and protects the housing market.  He has also helped Valley families avoid foreclosure through his constituent services program and foreclosure prevention workshops.

The ceremony took place at New Economics for Women’s Tierra del Sol community, which received a $595,000 AHP award from the Bank in 2000.  The development features 119 units of affordable housing, a K-5 charter school, the Dennis P. Zine Community Center and space for nonprofit service organizations.

Sherman also helped announce the results of the Affordable Housing Program funding competition.  In 2012, FHLBank of San Francisco awarded $35 million in grants through dozens of member financial institutions.  The funds will support 72 projects that will create or preserve nearly 3,600 units of affordable housing in 11 states, including 927 units in Los Angeles County and a 12-unit housing development under construction by Habitat for Humanity-San Fernando/Santa Clarita Valleys in Sylmar for veterans with families.

“We applaud Rep. Sherman for his efforts to expand housing opportunities for working families during his time in Congress,” said Lawrence H. Parks, Senior Vice President of Legislative and External Affairs at FHLBank of San Francisco.  “We are pleased to make these grants available to expand the supply of affordable housing and give families and individuals more housing options.  “At a time when it is very difficult for community developers to finance affordable housing projects, our AHP grants are making a difference by helping to fill the void.”

FHLBank of San Francisco’s Friend of Affordable Housing Award is presented annually to a valued supporter of affordable housing in the region and throughout the nation.  The Affordable Housing Program provides grants to support the creation of rental or homeownership opportunities for lower-income households.

*For more information about the 2012 AHP Grant Recipients, please click on the links below: 

http://www.fhlbsf.com/community/docs/2012a-ahp-projects.pdf

http://www.fhlbsf.com/community/docs/2012b-ahp-projects.pdf 

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 Introduction Follows House Bill Introduced by Representatives Sherman and Poe

Washington, DC – Congressman Brad Sherman (D-CA) lauded Senator Ron Wyden (D-OR) and Senator Orrin Hatch (R-UT) for introducing the Visa Waiver for Israel Act, S. 266, in the Senate on February 7, 2013.  The bill would pave the way for Israel’s entrance into the U.S. Visa Waiver Program.   The Senate legislation follows the introduction of the House version of the bill, H.R. 300, introduced on January 15, 2013, by Congressman Brad Sherman (D-CA) with lead co-sponsor Congressman Ted Poe (R-TX).  66 Representatives are currently cosponsoring the House bill.

“Israel is an important trading partner and ally with a well-educated and versatile workforce,” Senator Wyden said. “Including Israel in the Visa Waiver program will open up opportunities for collaboration and investment that will benefit both countries.”  Senator Wyden is the Chairman of the Senate Energy and Natural Resources Committee.

Senator Hatch is the most senior Republican in the Senate and is a senior member and former Chairman of the Senate Judiciary Committee.  The Visa Waiver for Israel Act was referred to the House and Senate Judiciary Committees. 

“I commend Senator Wyden and Senator Hatch for introducing the Visa Waiver for Israel Act in the Senate,” said Sherman.  “The widely bipartisan, bicameral support for this bill demonstrates the strength of the U.S.-Israel relationship and the positive prospects for this bill’s passage into law.  Adding Israel to the Visa Waiver Program will stimulate innovation and growth in our economy and greatly enhance cultural ties between our nations.”

The Senate bill is nearly identical to the Visa Waiver for Israel Act in May 2012 along with lead cosponsor Ted Poe and 11 other colleagues; 34 members of Congress cosponsored Sherman’s bill in 2012. 

The Visa Waiver Program allows travelers from 37 countries to enter the United States for business or leisure as visitors for up to 90 days without first getting a visa.  Visitors from other countries must obtain a visa from U.S. consular posts before traveling to the United States.

The Deputy Foreign Minister of Israel, Daniel Ayalon, released the following statement about the Visa Waiver for Israel Act:

“The proposed waiving of the visa requirement for Israeli tourists visiting America is a true reflection of the special, deep and mutually advantageous relations between Israel and the U.S. and between the Israeli and American peoples, and reports of the legislative initiative were received with great warmth in Israel.  I strongly commend Congressmen Brad Sherman and Ted Poe for all their efforts and also the many representatives that have co-sponsored the Visa Waiver for Israel Act.” 

Israelis entered the U.S. as temporary visitors about 320,000 times annually in recent years and that number is expected to increase significantly if Israel enters the program.  In 2011, Israelis spent over $1.6 billion in U.S. tourism, travel, and airfare. 

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SHERMAN OAKS, CA – Congressman Brad Sherman (D-Sherman Oaks) wrote to the Federal Aviation Administration (FAA) urging the agency to approve the lease proposal from the Los Angeles Unified School District (LAUSD) to continue to operate the North Valley Occupational Center-Aviation Center at Van Nuys Airport.

“The Aviation Center’s Aircraft Mechanics Program is one of the top ranked programs in the nation for high school and adult students seeking much sought after skills to gain high-paying jobs in the aviation and aerospace industry for aircraft operators at Van Nuys Airport and across the country,” said Congressman Sherman.

Los Angeles World Airports (LAWA) is working with LAUSD to draft a new long-term lease at the rate of $1.00 per year.  The FAA is required to review and approve the lease to ensure the terms meet current federal guidelines and policies.  Congressman Sherman is urging the FAA to expedite the review and approval process so that LAUSD and LAWA can negotiate a new lease before the current lease term expires on June 30, 2013.  Under the financial terms of a new lease, LAUSD is committed to continuing to operate the program at Van Nuys Airport. 

The full letter to the Federal Aviation Administration is below.

February 8, 2013

Mr. David Soumi

Acting Regional Administrator

Western-Pacific Region

Federal Aviation Administration

P.O. Box 92007

Los Angeles, CA 90009

Re: LAUSD Aviation Center at Van Nuys Airport

Dear Mr. Soumi:

I am writing to strongly urge the Federal Aviation Administration (FAA) to review and offer its consent to the proposal from the Los Angeles Unified School District (LAUSD) to remain a tenant at Van Nuys Airport and continue to operate the North Valley Occupational Center-Aviation Center under the terms of a new lease agreement.

The Aviation Center’s Aircraft Mechanics Program offers invaluable skills and training to dozens of students each year who ultimately receive FAA certification and get placed in high-paying jobs in the aviation and aerospace industries, including businesses at Van Nuys Airport.

On February 1, 2013, Los Angeles World Airports (LAWA) submitted an inquiry to the FAA regarding the specific request by LAUSD to occupy the same property for a $1.00 per year rent for a 15 year term under a new lease with LAWA.  This request is consistent with existing FAA policy and other similar arrangements that have been made for educational institutions at LAWA-owned facilities.  LAWA wants to retain the LAUSD and it needs guidance and consent from the FAA before the agency can negotiate and approve a new lease.

I am confident the FAA can address the issues brought to your attention in LAWA’s letter and allow the agency to immediately draft a new lease before the existing LAUSD lease expires on June 30, 2013.  Thank you for your urgent assistance in this matter.

Sincerely,

BRAD SHERMAN

Member of Congress

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 SHERMAN OAKS, CA – Congressman Adam Schiff (D-Burbank), Congressman Brad Sherman (D-Sherman Oaks) and other colleagues made recommendations to the National Park Service in response to the proposed alternatives for the Rim of the Valley Corridor Special Resources Study.

“We have a once-in-a-lifetime chance to protect the natural, cultural and historical resources of this diverse area, as well as expand recreational and educational opportunities for millions of park users throughout Southern California.  There are so many valuable resources within the study area that are suitable additions to the Santa Monica Mountains National Recreation Area, including the significant wildlife corridor linkage through the Simi Hills, the Chatsworth Reservoir, the Santa Susana Mountains range, Griffith Park, and much more,” said Congressman Sherman.

Congressmen Schiff and Sherman helped pass legislation in 2008 to direct the National Park Service to conduct a special resource study of the area known as the Rim of the Valley Corridor, generally including the mountains encircling the San Fernando, La Crescenta, Santa Clarita, Simi, and Conejo Valleys in Los Angeles and Ventura Counties. 

The legislation also directed the NPS to determine whether any portion of the Rim of the Valley Corridor study area is eligible to be designated as a unit of the national park system or added to an existing national park unit (Santa Monica Mountains National Recreation); and to explore other ways that private and governmental entities can protect resources and provide more outdoor recreation opportunities.

The National Park Service will further analyze the proposed alternatives through an Environmental Impact Analysis and finalize their recommendations to the U.S. Department of the Interior and Congress in 2014.  The public will have an opportunity to submit comments on the findings and recommendations of the draft report before it is finalized next year.  The public can also stay involved and up-to-date with the process at www.nps.gov/pwro/rimofthevalley.

The full letter to the National Park Service is below.

February 6, 2013

Anne Dove

National Park Service

570 W. Avenue 26, #175

Los Angeles, CA 90065

Dear Ms. Dove:

We write to provide our view of the National Park Service’s ongoing Rim of the Valley Corridor Special Resources Study. We are pleased that the Study’s recently released Preliminary Findings and Alternative Concepts document found the study area to be a suitable addition to Santa Monica Mountains National Recreation Area (SMMNRA) and we have a series of recommendations to improve the alternatives in the document.

We share the Study’s assessment that the study area contains nationally significant resources and would be a feasible addition to SMMNRA. The study area offers outstanding examples of geologic history, including the Transverse Ranges Province, and high levels of biodiversity, such as the rare San Fernando Valley spineflower at Laskey Mesa in the Simi Hills. The study area includes a superb example of the rare Mediterranean chaparral ecosystem. It also has enormous importance as a hiking, educational and recreational resource. These attributes and others should be protected for future generations to enjoy. Using the collaborative partnership-based park model, employed successfully by SMMNRA, will allow the boundary of SMMNRA to be expanded to include part or all of the study area and will ensure that NPS and its partners can protect natural and cultural resources in that area and provide recreational opportunities to the surrounding populations.

While it is clear that the study area is a suitable and feasible addition to the SMMNRA, the alternatives put forward in the document offer different approaches to achieving this worthwhile and critical goal. And we believe that the best approach would be to draw from the strengths of two different alternatives.

Alternatives C and D both expand the boundary of SMMNRA and would provide SMMNRA the authority to manage the new area in the same manner as the existing NRA, in partnership with existing land management agencies and organizations. But because the two alternatives have different focuses -- C on expanding recreational opportunities for urban audiences and D on promoting the long term resiliency of the natural resources within the area -- choosing only one of these alternatives would leave thousands of acres of nationally significant resources without adequate protection. The National Park Service should create a hybrid alternative that would include the boundary extensions of SMMNRA of both alternatives C and D. This hybrid alternative would provide comprehensive preservation of the region’s mountain ranges and trail systems and maintain habitat connectivity, while also ensuring that the objects of the two alternatives are realized.

Alternative D also wisely recognizes the value in facilitating habitat connectivity between the Los Padres National Forest and Rim of the Valley Corridor by authorizing NPS to engage in cooperative conservation partnerships with public and private actors to the north of the study area. This Cooperative Conservation Partnership Area should remain in the hybrid alternative. A Cooperative Conservation Partnership Area should also be added to the hybrid alternative to connect the two portions of the Angeles National Forest in the Santa Clara River watershed. This inter-mountain range habitat linkage in the Angeles National Forest would ensure the preservation of this critical habitat.

Although Alternative B would not expand the SMMNRA boundary and would not provide NPS the authority to acquire or manage lands outside of the current SMMNRA boundary, it does include one worthwhile proposal that should be included in the hybrid alternative. The Alternative recommends that SMMNRA provide continuing technical assistance to a partnership of public and private landowners, organization and institutions in the region. This technical assistance could take many helpful forms -- NPS staff participating in and lending guidance to national resource surveys, education activities focused on connecting people to the resources and stories of the study area and working on Rim of the Valley Trail planning. This idea should be incorporated into the hybrid alternative so that local residents can better interact with and obtain a stronger understanding of the beauty and history of the area.

Additionally, both the Rim of the Valley Study and the San Gabriel Mountains and Watershed Special Resources Study include the western part of the Angeles National Forest. We request that that Rim of the Valley Study incorporate the findings from the San Gabriel Study, which is further along in the study process, into their analysis of this area. We further ask that that the San Gabriel Mountains in the western Angeles National Forest north of the Rim of the Valley trail are included in any future San Gabriel Mountains National Recreation Area, not in an expansion of the SMMNRA.

Lastly, we believe that the hybrid alternative requires direct NPS management. Only NPS has the resources and expertise needed to protect the significant natural resources in the study area, ensure habitat connectivity between adjacent tracks of federally protected land, support trail and recreation efforts, and provide critical technical assistance to enhance residents’ experience with and connection to the study area. As this process moves forward, we strongly urge NPS to give full consideration to a hybrid alternative that includes the strengths of Alternatives B, C and D.

Sincerely,

ADAM SCHIFF

BRAD SHERMAN

JUDY CHU

HENRY WAXMAN

TONY CARDENAS

KAREN BASS

GRACE NAPOLITANO

LUCILLE ROYBAL-ALLARD

MARK TAKANO

ALAN LOWENTHAL

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Washington, DC -- Today Congressman Brad Sherman (D-Sherman Oaks) issued the following statement about the lawsuit filed by the Justice Department against Standard & Poor’s Rating Services on Monday, February 4:

“This action by the Justice Department against Standard & Poor’s regarding mortgage-backed bonds rated by S&P shines a light on slow action by the SEC to enforce the Franken-Sherman Amendment to the Wall Street Reform and Consumer Protection Act, also known as Dodd-Frank.

“The rating of bonds is the only arena where the umpire is selected and paid by one of the teams. When bond rating agencies are selected by those who are selling the very bonds they are evaluating, and when the bond rating agencies can earn millions of profits per contract, there is an incentive to try to please the bond issuers. That is why Senator Franken and I worked to change the system so that an independent body would select the bond rating agency and providing high ratings would not be the road to high profits for the rating agencies.”

Congressman Sherman first offered a proposal in October 2009 to require the Securities and Exchange Commission (SEC) to end conflicts of interests in the selection of credit rating agencies by requiring an independent entity to assign credit rating agencies impartially.[1]  Senator Al Franken (D-MN) then championed the idea in the Senate, and successfully passed an amendment through the Senate to require the SEC to create a Board to independently assign qualified credit rating agencies to rate issuances.  In June 2010, Sherman appeared before the conference committee on financial regulatory reform to advocate for the proposal.  The final version of the Wall Street Reform and Consumer Protection Act, signed into law by President Obama in July 2010, required the SEC to conduct a study, and then implement the Franken-Sherman Amendment within two years, unless a credible alternative to ending conflicts of interests is identified.  The SEC is now over six months behind in enforcing the Franken-Sherman Amendment.  

Senator Franken noted the importance of credit rating agencies in the statement he released yesterday: 

“Our nation’s financial meltdown happened in no small part because credit rating agencies had a perverse incentive to give triple-A ratings to financial instruments that turned out to be junk,” said. U.S. Sen. Al Franken. “In turn, investors in Minnesota and across the country relied on those ratings when making investments and were badly hurt financially.”

Likewise, the Financial Crisis Inquiry Commission said the financial crisis “could not have happened without the rating agencies.”[2] 

“It is time for the SEC to implement the law,” Congressman Sherman said. “The present system has failed. Bond rating agencies like Standard & Poor’s gave triple A ratings to alt-A bonds.  In the future, those selling mortgage-backed bonds should not select the credit rating agency that would evaluate those bonds. Bond rating agencies will be free to give tough grades, when warranted, without the fear of losing business and profits.”

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[1] Amendment no. 21 by Mr. Sherman and Mr. Lynch; Full Committee Markup of H.R. 3890, the Accountability and Transparency in Rating Agencies Act before the H. Comm. On Fin. Serv., 111t h Cong. (Oct. 27, 2009) available at archives.financialservices.house.gov/Hearings/hearingDetails.aspx.  Amendment passed by voice vote.

[2] Conclusions of the Financial Crisis Inquiry Commission xxv (Fin. Crisis Inquiry Comm’n 2011).