The rating firms are fighting to avoid any new regulation or legislation that would increase scrutiny of their research or open them to new competition.

She said the LJM partnerships were neither Enron affiliates or obligations and thus did not have to be disclosed to the rating firms.

That information, in the end, was deceptive, as Enron's subsequent disclosures and its restatements of its financial results make clear, the rating firms say.

While the three rating firms have vigorously fought any attempt by the agency to regulate their business, they do receive some special privileges.

"Some of the high-yield funds actually did better than the average equity fund," said A. Michael Lipper, president of the rating firm.

Moody's Investors Service, another of the three major rating firms, has not changed its rating for the state since it was downgraded in 1990.

He said Westchester was still the only county in the state "with a triple-A bond rating by all three major rating firms."

I wonder if the rating firms aren't a large part of the problem rather than the unbiased agents of truth they claim to be.

Then the S.E.C. could eliminate its certification process, making it possible for more rating firms to provide investors with information.

In my opinion, there are two paradoxes: there are international rating firms, but they are not subject to international supervision.