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John Hooper in Rome
guardian.co.uk, Thursday 4 August 2011 21.02 BST
John Hooper in Rome
guardian.co.uk, Thursday 4 August 2011 21.02 BST
Carlo Maria Capistro – chief prosecutor of Trani, a small Adriatic port – told Reuters that his office was checking to see whether the rating agencies "respect regulations as they carry out their work".
...S&P, which along with other rating agencies has been strongly criticised in Europe for downgrading countries such as Greece, said in a statement it believed the Trani inquiry "has no foundation". It added: "We shall strenuously defend our work, our reputation and that of our analysts."
Moody's said it took "its responsibilities surrounding the dissemination of market-sensitive information very seriously", and was co-operating with the authorities.
The Trani prosecutors began investigating Moody's in May last year after a complaint by two consumer associations about a report from the ratings agency which said the Italian banking system was at risk from the crisis in Greece. It sparked a round of selling on the Milan bourse.
It is not clear why the consumer groups took their grievances to out-of-the-way Trani, but Italian prosecutors have wide, discretionary powers to look into alleged offences brought to their attention.
...Standard & Poor's came under scrutiny in May after it threatened to downgrade Italy's credit rating because of its huge public debt. Italy is proportionately the second most highly indebted country in the eurozone after Greece.
The inquiry has since been widened to include a report by S&P last month in which it criticised the government's austerity measures. Those questioned by the Trani prosecutors include the president-designate of the European Central Bank, Mario Draghi; Italy's finance minister, Giulio Tremonti, and a former prime minister, Romano Prodi.
A separate inquiry is being conducted by prosecutors in Rome into market panics in June and July. Italy's stock market regulator, Consob, last month summoned Moody's and S&P for meetings and urged them not to release their statements during market hours.
Elio Lanutti, president of one of the consumer groups that sparked the inquiry, said: "The three 'sisters' – Standard & Poor's, Moody's and Fitch – are an erratic danger to state sovereignty in the areas of economics and finance".
...S&P, which along with other rating agencies has been strongly criticised in Europe for downgrading countries such as Greece, said in a statement it believed the Trani inquiry "has no foundation". It added: "We shall strenuously defend our work, our reputation and that of our analysts."
Moody's said it took "its responsibilities surrounding the dissemination of market-sensitive information very seriously", and was co-operating with the authorities.
The Trani prosecutors began investigating Moody's in May last year after a complaint by two consumer associations about a report from the ratings agency which said the Italian banking system was at risk from the crisis in Greece. It sparked a round of selling on the Milan bourse.
It is not clear why the consumer groups took their grievances to out-of-the-way Trani, but Italian prosecutors have wide, discretionary powers to look into alleged offences brought to their attention.
...Standard & Poor's came under scrutiny in May after it threatened to downgrade Italy's credit rating because of its huge public debt. Italy is proportionately the second most highly indebted country in the eurozone after Greece.
The inquiry has since been widened to include a report by S&P last month in which it criticised the government's austerity measures. Those questioned by the Trani prosecutors include the president-designate of the European Central Bank, Mario Draghi; Italy's finance minister, Giulio Tremonti, and a former prime minister, Romano Prodi.
A separate inquiry is being conducted by prosecutors in Rome into market panics in June and July. Italy's stock market regulator, Consob, last month summoned Moody's and S&P for meetings and urged them not to release their statements during market hours.
Elio Lanutti, president of one of the consumer groups that sparked the inquiry, said: "The three 'sisters' – Standard & Poor's, Moody's and Fitch – are an erratic danger to state sovereignty in the areas of economics and finance".
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