June 3, 2014 / 6:30 AM / in 4 years

ESMA censures S&P for internal control failings

LONDON, June 3 (Reuters) - Europe’s markets watchdog has issued a notice censuring ratings agency Standard & Poor’s for internal control failings related to it erroneously announcing in 2011 it was downgrading France’s debt.

In a statement on Tuesday, the European Securities and Markets Authority (ESMA) said the incident, involving an email sent out to subscribers stating “France (Republic of) (Unsolicited Ratings): DOWNGRADE”, when S&P’s rating of France had not been downgraded, breached regulations.

“ESMA found that this incident was the result of a failure by S&P to meet certain organisational requirements set out in the CRA Regulation, relating to sound internal control mechanisms, effective control and safeguard arrangements for information processing systems and decision-making procedures and organisational structures,” ESMA said. (Reporting by Chris Vellacott. Editing by Matt Scuffham)

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