Floyd Abrams, the lead attorney for Standard & Poor's, told CNBC Tuesday that "the intensity of the investigation" into the agency's bond ratings "significantly increased" after S&P downgraded the U.S. government's credit rating in 2011.
Late Monday, the U.S. Justice Department launched a civil lawsuit against S&P and its parent company McGraw-Hill, accusing the ratings agency of inflating its ratings and mortgage investments prior to the financial crisis.
It is the first federal enforcement action against a credit rating agency over its bond ratings. S&P—as well as Moody's and Fitch—have long faced criticism for assigning high ratings to thousands of sub-prime and other mortgage securities that quickly turned sour.
Abrams said he "doesn't think anyone knows" for certain whether the lawsuit was in retaliation for S&P's downgrade of the U.S, which followed the impasse in Washington during the summer of 2011 over raising the debt ceiling.
"There was no fraud," said Abrams, partner at the law firm Cahill Gordon & Reindel. "The ratings that were issued were believed by the people that issued them,"
"The organization was trying its best to come out with answers at a time when answers were very difficult to come by," he said. "I don't think we should be involved and I don't think Moody's should be charged," although he acknowledges no specific knowledge of Moody's actions prior to the financial crisis.
The government doesn't have to show that people lost money, they have to show that S&P "literally disbelieved its ratings. There is no proof of that, because it isn't so."
Abrams says that the ratings issued by S&P were identical to those issued by other ratings agencies and echoed the views on risk held by government agencies and officials at the time.
"There was a lot of disagreement at an extraordinarily volatile time in this country about how bad the housing market was going to be," he said, noting that S&P was "not alone" in underestimating the downside to the economy.
"These were the opinions of S&P reached at a committee level and they were identical opinions with at least one other ratings agency on each CDO," he said.
"We aren't making a first amendment defense in this case," he added.