SEC adopts rules on loan-backed securities

WASHINGTON (AP) — Financial firms that sell securities backed by loans, like the kind that fueled the 2008 financial crisis, will have to give investors details on borrowers' credit record and income under action taken Wednesday by federal regulators.

The Securities and Exchange Commission adopted the rules for securities linked to mortgages and auto loans on a 5-0 vote.

The commissioners also voted, 3-2, to impose conflict-of-interest rules on the agencies that rate the debt of companies, governments and issues of securities.

Home mortgages bundled into securities and sold on Wall Street soured after the housing bubble burst in 2007, losing billions in value. The vast sales of risky securities ignited the crisis that plunged the economy into the deepest recession since the Great Depression and brought a taxpayer bailout of banks.