From the ripple project website
https://ripple.com/working-with-ripple/ it states:
Beyond the basic payment uses, Ripple lets people go back to older forms of financial relationships trust-based, reputation-driven, and conveniently local. But by providing an internet-based platform, Ripple lets these relationships extend across global distances in almost real time, and at almost no cost. Whats more, because Ripple is a distributed system connecting people to people, anyone can play a role.
I would call trust-based financial relationships a counterparty risk. I'm on the fence about its utility, but I don't think you can misrepresent the probability of an I.O.U. default.