Italian prosecutors may have come up with a novel way to fix their country’s hemorrhaging markets and the world’s absence of confidence in the country’s solvency.Today, authorities stormed into the Milan offices of Standard and Poors and Moody‘s and seized documents in an investigation over “anomalous” market activity.
Reuters reports that the prosecutors were responding to complaints by consumer groups alleging that the markets’ nosedive was part of a “precise scheme by hedge funds and other unidentified players that could be linked to the negative comments about Italian public finances by the rating agencies.” The prosecutors have also asked Italy’s Securities and Exchange Commission to provide the ratings agencies’ registration papers.
S&P has called the accusations “groundless.”
Moody’s told Bloomberg News that their organisation “takes its responsibilities surrounding the dissemination of market sensitive information very seriously and is cooperating with the authorities.”
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