AG McDaniel Joins S&P Lawsuit, Rolls Out Legislative Agenda

Less than two weeks after his derailed gubernatorial bid, Attorney General Dustin McDaniel (D) is making headlines as the state’s top lawyer.

Joining several other states and the federal government, McDaniel filed a lawsuit against Standard and Poor’s, alleging that the credit rating agency intentionally misled investors in the way it rated the toxic assets at the center of the nation’s 2008-9 financial crisis.

According to McDaniel, S&P is accused of forsaking its claims of independence and objectivity by improperly rating structured finance securities that were backed by subprime mortgages. S&P allowed its analysis to be influenced by its desire to earn lucrative fees from its investment bank clients, according to the complaint filed in Pulaski County Circuit Court.

“Arkansas consumers expect credit-rating agencies to provide unbiased and independent analysis of securities,” McDaniel said. “We believe S&P was more concerned with making additional profits than by assessing risk, and that the agency’s actions are directly linked to the financial crisis.”

McDaniel’s suit alleges that S&P violated the Arkansas Deceptive Trade Practices Act.

LEGISLATIVE AGENDA
McDaniel also announced his support for several legislative items in the 2013 regular session.

He said he will support proposals to strengthen the state’s human-trafficking laws and ensure the constitutionality of Arkansas’ law on executing prisoners.

The execution measure, which will be discussed in a hearing on Wednesday, is a response to last year’s Arkansas Supreme Court ruling that the existing Methods of Execution Act was unconstitutional.

“This bill establishes a clear blueprint to be provided by the Legislature for the Department of Correction to follow during an execution,” McDaniel said. “Regardless of one’s views on the death penalty, Arkansas juries have issued capital-punishment verdicts, and it is our responsibility to make sure those verdicts are carried out in a constitutional manner.”

Other legislative initiatives include the elimination of parental rights for those convicted of rape, consumer protections for Arkansans considering enrollment in for-profit colleges, and a series of bills designed to increase public confidence in elections and the initiative process.

McDaniel also said his office will be committed to working with the state legislature to ensure the state’s school-funding system remains constitutional.

“One of my main education goals has been to keep us out of court as it relates to how we fund our public schools,” McDaniel said. “We have been true to the lessons of the Lake View case, and I hope we continue to be. Our office is ready to offer any assistance it can to the General Assembly to ensure we stay the course on education issues.”

On the elections front, McDaniel said he is working with state lawmakers on proposals to improve transparency in the process of collecting signatures for initiated act proposals, to crack down on misconduct related to absentee ballots, and to require criminal background checks for people seeking elective office.