Italy Seeks Charges Against Rating Agencies for Downgrade of Italian Debt; Courts Go Nuts Again
I am still shaking my head over the insane verdict last month in which Six Italian Scientists Convicted because they failed to predict an earthquake.
Six scientists and a government official were sentenced to six years in prison for manslaughter by an Italian court on Monday for failing to give adequate warning of an earthquake that killed more than 300 people in L’Aquila in 2009.
The seven, all members of a body called the National Commission for the Forecast and Prevention of Major Risks, were accused of negligence and malpractice in evaluating the danger and keeping the central city informed of the risks.
This month Italy seeks trials over credit downgrades
Italian prosecutors have requested that five employees of Standard & Poor’s and two from Fitch be put on trial for alleged market manipulation connected to their downgrades of Italy’s credit rating.
The prosecutors contend the accused violated EU rules by releasing the downgrades when European markets were open and by not alerting the Italian government 12 hours before the decisions, dating back to earlier this year and last year, were made public. A judge must now decide whether to order a trial, a decision that could come in a few months.
“These claims are entirely baseless and without any merit as our role is to publish independent opinions about creditworthiness according to our public and transparent methodologies, which we apply consistently around the world,” S&P said.
“We will continue to perform our role without fear or favour of any investor, debt issuer or other external party and to defend our actions, our reputation and that of our people.”
I have no respect for the big three rating agencies, but this action is preposterous.
The word “insane” does not even begin to describe the prosecution (let alone conviction) of the earthquake scientists.
Mike “Mish” Shedlock