Standard & Poor’s, the McGraw-Hill Cos. unit facing a $5 billion lawsuit from the U.S. Justice Department, hired one of Wall Street’s top lobbyists to run its global regulatory and policy operations.
Courtney Geduldig, a former Republican staff member of the U.S. Senate Banking Committee, will join S&P on March 1 as a vice president. She will help S&P navigate new financial rules around the world.
Known on Capitol Hill for her bipartisan relationships, Geduldig has been the head lobbyist for the Financial Services Forum, a trade association that represents the chief executive officers of Goldman Sachs Group Inc., JPMorgan Chase & Co., Citigroup Inc. and other large financial companies.
Geduldig, in a statement, said she was “very pleased to be joining an exemplary team at S&P.”
S&P and the other major credit rating firms, including Moody’s Corp. and Fitch Ratings, are under pressure from regulators around the world after they gave top grades to securities that later soured and helped cause the 2008 financial crisis. The Justice Department suit is the first U.S. federal action against one of the three major credit rating companies.
The New York-based company said in its earnings statement released today that the Justice Department suit, which contends the company knowingly inflated ratings on certain collateralized debt obligations, “is entirely without factual or legal merit and that the company has very strong defenses against this and all pending litigation.”
The hiring of Geduldig is unrelated to the lawsuit and has been in the works for months, according to Catherine Mathis, an S&P spokeswoman.
Geduldig’s new role will go beyond Washington, as the ratings company faces new regulations throughout Europe, Japan and Australia. A lawyer who also worked at the Treasury Department during President George W. Bush’s administration, she will develop and coordinate the company’s strategy in each of the new regulatory regimes, Mathis said.
“We’re very excited and think she’s terrific,” Mathis said in a telephone interview. “She will be a real asset to the organization.”
Geduldig, 37, left Capitol Hill in 2010, after working as Tennessee Republican Senator Bob Corker’s chief financial counsel throughout the debate over the Dodd-Frank Act. The law, which re-wrote financial regulation, set new rules for credit ratings companies like S&P, New York-based Moody’s and Fitch, which is half-owned by Fimalac SA of Paris and half-owned by Hearst Corp.
At the Forum, Geduldig has worked on proposals to change Dodd-Frank, including modifying its ban on proprietary trading and fighting efforts in Congress to break up the largest banks.
“Courtney has served the Forum with remarkable distinction,” said Rob Nichols, the group’s president. “S&P is fortunate to have her leadership.”