‘Good’ settlement reached

While The Standard and Poor’s settlement is subject to court approval, the group of 92 claimants challenged Standard and Poor’s conduct in assigning AA and AAA credit ratings.

They had bought synthetic collateralised debt obligations issued by Lehman Brothers Australia and took the action against McGraw-Hill Financial and Standard and Poor’s.

City of Swan Mayor Mick Wainwright described the confidential settlement as “a welcome end to the monumental David and Goliath style action”.

Cr Wainwright said the agreement vindicated the lengthy international pursuit to recover funds.

“As one of the few Australian local governments prepared to stand up to these international giants of the finance sector, we hope this settlement will finally see the conclusion of this eight-year saga,” he said.

While Moree Plains Shire helped lead the Standard and Poor’s case, the City of Swan had joined the Shire of Wingecarribee and the Shire of Parkes, in leading the Lehman Brothers case, which was resolved in 2012.

Cr Wainwright said the council had rejected a previous settlement of six cents in the dollar.

“We were successful in the Federal Court action to prove ourselves against Lehman Brothers,” Cr Wainwright said.

“This final settlement we’ve made with Standard and Poor’s brings to an end a long, sad and sorry saga but it’s a good result.”