- Chief Compliance Officer and VP of Legal Affairs, Arrow Electronics
By 
Adrianne Appel2022-11-15T18:51:00
Credit rating agency S&P Global Ratings agreed to pay $2.5 million and improve its compliance practices to settle allegations by the Securities and Exchange Commission (SEC) that its marketing team pressured the ratings team concerning the rating of a particular mortgage-backed security transaction.
Ratings agencies are prohibited from issuing a rating if a sales and marketing employee tries to influence the determination, noted Osman Nawaz, chief of SEC’s Complex Financial Instruments Unit, in a press release Monday.
For this reason, S&P Global required internal communications between the analytics department and marketing department to be “chaperoned,” or sent through its compliance department for review and redaction, to make sure they didn’t violate conflict of interest rules. This check appeared to fail regarding the residential mortgage-backed security transaction, according to the SEC’s order.
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