The Financial Crisis Inquiry Commission, a group formed to investigate the causes of the financial crisis, found the failure of ratings agencies such as Moody's and Standard & Poor's to assess the risk of many investments, particularly mortgage-backed securities, was one of the root causes of the financial crisis. Even after the crisis, individual investors still depend on those agencies to help them assess the safety and soundness of companies and the bonds they issue.

To help prevent a future widespread ratings failure, Dodd-Frank requires the SEC to draft new rules requiring more extensive government oversight of the industry, rescinding old financial regulations that gave favored status to companies who received high credit ratings and subjecting ratings agencies to legal liability for the consequences of faulty ratings.

More than a year after the passage of Dodd-Frank, the SEC has yet to open the called-for Office of Credit Ratings to monitor the agencies, nor has it tapped a director, Jackson says. In fact, according to its website, the SEC has completed only two rule changes regarding credit ratings agencies and has indefinitely suspended enforcement of the legal liability provision.