Members of Congress leveled sharp criticism at what they called egregious lapses at the credit-rating agencies.

Conflicts of interest were largely responsible for the disastrous performance of credit rating agencies in assessing the risks of mortgage-backed securities, former officials at Moody’s testified.

Documents revealed by a House panel show that executives were well aware that there was little basis for giving AAA ratings to thousands of mortgage-related securities.

The attorney general of Connecticut accused the nation’s three big ratings firms of systematically underrating debt issued by local and state governments.

Fitch Ratings may lower the credit ratings of Wachovia, the bank that ousted its chief executive after greater-than-expected mortgage losses.

The S.E.C. proposed new rules intended to stem conflicts of interest, expand disclosure for Wall Street’s credit rating industry and flag the ratings of more complex securities.

Under fire for the high ratings they awarded to subprime mortgage securities, three large credit rating firms are close to announcing a broad deal with the New York attorney general.