US regulator charges 6 credit rating agencies with recordkeeping failures
Firms agree to pay combined civil penalties of more than $49 million
ISTANBUL
The US Securities and Exchange Commission (SEC) said Tuesday that it charged six credit rating agencies with significant recordkeeping failures.
"The firms admitted the facts set forth in their respective SEC orders; acknowledged that their conduct violated recordkeeping provisions of the federal securities laws; agreed to pay combined civil penalties of more than $49 million," it said in a statement.
The rating agencies include Moody’s Investors Service, Inc., which agreed to pay a $20 million civil penalty, S&P Global Ratings with a $20 million civil penalty, and Fitch Ratings with an $8 million penalty.
They also include HR Ratings de México, S.A. de C.V., which agreed to pay a $250,000 civil penalty, A.M. Best Rating Services, Inc. a $1 million civil penalty, and Demotech, Inc. a $100,000 civil penalty.
The SEC said each of the credit rating agencies, except for A.M. Best and Demotech, is also required to retain a compliance consultant.
"We have seen repeatedly that failures to maintain and preserve required records can hinder the staff’s ability to ensure that firms are complying with their obligations and the Commission’s ability to hold accountable those that fall short of those obligations, often at the expense of investors," Sanjay Wadhwa, deputy director of the SEC’s Division of Enforcement, said in a statement.
