US fines ratings agencies for 'significant' recordkeeping failures
WASHINGTON
The U.S. market regulator charged and fined six major ratings agencies on Sept. 3, including Moody's, S&P and Fitch, over what it called "significant recordkeeping failures."
The six agencies were fined a total of more than $49 million "for significant failures by the firms and their personnel to maintain and preserve electronic communications," the U.S. Securities and Exchange Commission (SEC) said in a statement.
The biggest civil penalties were handed out to the three major U.S. ratings agencies, with Moody's and S&P Global Ratings both agreeing to pay a $20 million civil penalty, while Fitch Ratings agreed to pay $8 million.
The three other agencies fined were HR Ratings de Mexico, A.M. Best Rating Services, and Demotech, who agreed to pay much smaller fines.
The SEC has hit dozens of firms with fines for failing to maintain records, largely in connection with employees' use of text messages and messaging apps such as WhatsApp.
All the firms acknowledged that their conduct "violated recordkeeping provisions of the federal securities laws," the SEC said.
"In today's actions, the Commission once again makes clear that there are tangible benefits to firms that make significant efforts to comply and otherwise cooperate with the staff's investigations," said Sanjay Wadhwa, the deputy director of the SEC's Division of Enforcement.
All six agencies have now "begun implementing improvements to their compliance policies," the SEC said.
