Rating agencies have taken a lot of heat for their failures
to warn investors about both the Enron and the mortgage-backed
securities crises. Just two years ago, the agencies started
rating hedge funds. Will they be any better at catching the
funds' problems before it's too late?
Some of the recent moves don't inspire confidence. Ospraie's
now-defunct flagship fund got a "pass" operational rating from
Amber Partners until it announced it was liquidating, and Amber
Capital Management's troubled hedge fund, which has frozen
redemptions, still gets a passing grade. (The two Ambers aren't
But other rating agencies are starting to talk tough.