S&P Slams Italy's Criminal Probe As “Groundless” After Debt Downgrade Charges

Standard & Poors, one of the 'big three' global credit rating companies, hit back at a market abuse investigation led Italian prosecutors, by saying the claims had no merit.

Standard & Poor's (S&P) said in a statement that Italy's prosecutors' investigation, which was launched on January 13 this year following the groups downgrade of the country's credit rating, was "groundless" and that the group will "continue to defend its actions, company reputation and its employees."

Italian prosecutors finished their investigation into S&P's alleged market manipulation and abuse of privileged information today, according to an unnamed source cited Reuters.

According to the same source, the probe could lead "up to five current or former S&P analysts facing criminal trial."

Prosecutors claim that some of the ratings conducted by S&P and another ratings agency Moody's, which is also under Italian prosecution scrutiny, were incorrect and that reports on Italy and its banking system by both agencies were in "at least one case leaked during market hours", which led to a steep downturn in the Milan stock market.

While S&P has denied and hit back at the allegations, Moody's has said it takes "the dissemination of market-sensitive information very seriously and is cooperating with authorities."