Moody's Finds "Inappropriate" Conduct in Rating of European Structured Debt

"Inappropriate factors" is an interesting label to use, especially when termination punishment is being considered. It covers a wide range of possibilities.

Our google search of 'inappropriate conduct' turned up this picture of Ms. Spears. Score one for Wall Street in not having yet taken this category of infamy away from Sin City. "Oops, we crashed it again, we shattered your dreams, we're hearing your screams..."

Warren Buffet is a major shareholder in Moody's. He does not date Ms. Spears, but is rumoured by Bess Levin of Dealbreaker to be cavorting with lesser names of entertainment fame. Dealbreaker.com

If the lady (Britney, not Bess) was swimming in this market when the tide goes out it might make things more interesting. Note to CNBC for when the Dow cracks 9,000, although we'd suggest you acquire some one piece suits for the sake of your viewers.


Moody's initiates disciplinary proceedings for employees reviewing some European ratings
Jul 1, 9:17 AM EDT

NEW YORK (AP) -- Moody's says it initiating employee disciplinary proceedings and reviewing measures to strengthen its monitoring process based on a review of certain European debt ratings.

Moody's Investors Service has said it would review whether computer errors wrongly assigned top-notch ratings to debt known as constant-proportion debt obligation, or CPDOs.

The review shows Moody's employees did not make changes to ratings criteria to hide the error. But, employees working on monitoring the ratings also did not meet the company's code of professional conduct, Moody's says.

Moody's says some employees considered "inappropriate factors" when reviewing the ratings after the computer error was discovered.

Lawsuit filed June 30, 2008


Moody's Says Some Employees Breached Code of Conduct on CPDOs
By Emma Moody
July 1, 2008 09:03 EDT

July 1 (Bloomberg) -- Moody's Corp. said some members of its credit committee breached its code of conduct when evaluating some structured debt products.

The company has initiated disciplinary proceedings against some employees who were involved in monitoring constant proportion debt obligations, or CPDOs, the company said in a statement distributed today on Business Wire.

``Penalties could include termination of employment,'' Moody's said in the statement. In a separate release, Moody's said Noel Kirnon, the head of the company's global structured finance business is leaving the company.

To contact the reporter on this story: Emma Moody at emoody@bloomberg.net