By Karen Brettell

NEW YORK, May 14 (Reuters) – Legislation designed to create more independent credit ratings for risky assets may not result in more reliable indicators of an asset’s future performance and details on how the process would work are still unclear.

The U.S. Senate on Thursday voted in favor of a proposal by Democratic Senator Al Franken to create a clearinghouse that will be comprised in majority by investors including pension and other fund managers, who will be responsible for assigning a rating agency to rate complex products at their inception.

By removing the decision on who allocates the first rating on these assets from the issuers, the legislation aims to remove ratings shopping wherein issuers of risky debt could seek out agencies that gave more favorable ratings to assets.

Some industry professionals are skeptical, however, that selecting an agency via a committee would lead to more accurate ratings.

“You cannot have someone decide who is the best rating agency for any deal,” said Sylvain Raynes, founding principal at R&R Consulting in New York, and former analyst in structured securities at Moody’s Investors Service.