The Securities and Exchange Commission said they will not pursue fraud charges against Moody’s Investor Services. The financial watchdog agency was investigating claims of inflated ratings to some European debt just before the financial crisis.

Marketplace’s Jeremy Hobson has the story from New York. Plus, watch The Whiteboard with senior editor Paddy Hirsch, for a fun explainer on how ratings agencies are paid by the sellers of the securities they rate.

JEREMY HOBSON: Regulators say they aren’t charging Moody’s because the activity in question took place in Europe. It involves Moody’s response to a computer glitch. A big one — in which top ratings were given to investments that were, well, not so amazing after all. The SEC says when Moody’s discovered the glitch, it didn’t fix the underlying ratings for a year because it was worried for its reputation.

The story is a familiar one in the ratings industry, which has largely escaped punishment for its role in the financial crisis.

PETER HAHN: If I were running a large rating agency, the sweat would have dried from my brow by now and I’d be going forward.

Peter Hahn teaches corporate finance at the Cass Business School.

HAHN: The rating agencies are another version of sort of too big to fail. So here you’ve got organizations that seem to have admitted huge lapses, but yet remain and have market power.

In other words, the ratings agencies are too important to the system. Regulators have yet to bring civil charges against any of the major raters. And that recent financial overhaul passed by Congress wasn’t much of an overhaul for Moody’s and its competitors.

In New York, I’m Jeremy Hobson for Marketplace.