The European stock market authority fines Moody's 3.7 million euros for conflict of interest

The European Securities and Markets Authority (ESMA) has imposed a total fine of 3.7 million euros on five entities of the rating agency Moody's for conflicts of interest for having issued notes for entities in which it had interests. "All violations were found to be due to negligence on the part of Moody's," ESMA said in a statement.

The highest penalty, of 2,735,000 euros, is for Moody's subsidiary in the United Kingdom, but those that the rating agency has in Germany (340,000 euros), France (280,000 euros), Spain (174,000) and Italy (174,000), ESMA said in a statement on Tuesday.

In the UK, he is mostly criticized for issuing new ratings for entities in which he has exceeded 10% ownership or voting rights, is a member of the board of directors or of the supervisory body.

Also for not having adequately reported conflicts of interest, something that happened in 206 cases for 65 entities. In France, Germany, Italy and Spain, Moodys also failed to adequately disclose information on conflicts of interest in 72 cases for 36 entities.

"ESMA believes that it is crucial, to ensure good quality independent ratings and to protect investors, that CRAs carefully identify and subsequently eliminate or manage and disclose conflicts of interest to avoid shareholder interference in the investment process. qualification ", explains the authority.


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