S&P; puts Compton bonds on credit watch
Standard and Poor’s rating service put the city of Compton’s lease revenue bonds on credit watch with negative implications Friday afternoon because of a lack of response to inquiries and allegations of fraud and “abuse of public moneys.”
The city’s leave revenue bonds, rated BB, could suffer additional penalties.
“Should we fail to receive sufficient independently audited financial information from the city, we could withdraw or suspend the ratings in accordance with our procedures for withdrawal or suspension,” S&P; said in a release.
Compton city offices were closed Friday. No city official cold be reached for comment.
Controversy has recently surrounded Compton’s finances. The city’s independent auditor, Mayer Hoffman McCann, recently quit and refused to sign off on the city’s financial statements.
Compton has accrued a more than $40-million deficit over the last several years, largely by borrowing money from other city accounts to pay its general fund expenses. Last year, the city slashed its workforce 15%.
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