The credit rater Standard & Poor’s may have been late to throw Sino-Forest Corp. into the wood chipper when it withdrew its opinion on the company’s debt this week. At least it wasn’t last.
The end seems near for Sino-Forest. The Chinese-Canadian timber company’s bonds are priced for a default. Securities regulators in Canada have accused the company of fraud and suspended trading in its stock. One question lingers: Which of the company’s paid opinion merchants will be the last to step aside? Will it be a credit rater? Or will it be the company’s auditor, Ernst & Young LLP in Toronto, which has yet to rescind any of its reports on Sino-Forest’s finances?