S&P in dutch with the EU

JUN 02, 2010
By  John Goff
European Union regulators on Thursday said they have charged U.S. credit ratings agency Standard & Poor's with monopoly abuse, alleging that the company unfairly demands payment for securities information numbers in databases. S&P, a division of New York-based information-services company McGraw-Hill Cos., is the only issuer of international securities identification numbers for U.S. securities. The European Commission says it believes S&P abuses its monopoly position as issuer by requiring payment from European financial groups and data service providers when they use the numbers in databases. "This behavior amounts to unfair pricing," the EU said in a statement. "(The numbers) are indispensable for a number of operations that financial institutions carry out — for instance, reporting to authorities or clearing and settlement — and cannot be substituted." It said other issuers do not charge any fees or only charge for the costs of distributing the numbers, not how often they are used. Regulators said S&P does not incur any distribution costs for the numbers to financial service providers because clients get them directly from Thomson Reuters Corp. or Bloomberg. S&P has eight weeks to reply to the EU charges and can seek an oral hearing to defend its case before the EU executive takes a final decision that can lead to fines of up to 10 percent of yearly global turnover for each year the company broke the law. Businesses can also settle antitrust cases by making a binding commitment to avoid behavior that could cause competition problems. EU regulators said they started investigating the company in January. They are also probing possible monopoly abuse by financial information service Thomson Reuters for preventing customers from applying their own codes to financial market datafeeds.

Latest News

Slow is smooth, smooth is fast
Slow is smooth, smooth is fast

Chasing productivity is one thing, but when you're cutting corners, missing details, and making mistakes, it's time to take a step back.

Edward Jones layoffs about to hit employees, home office staff
Edward Jones layoffs about to hit employees, home office staff

It is not clear how many employees will be affected, but none of the private partnership’s 20,000 financial advisors will see their jobs at risk.

CFP Board hails record July exam turnout with 3,214 test-takers
CFP Board hails record July exam turnout with 3,214 test-takers

The historic summer sitting saw a roughly two-thirds pass rate, with most CFP hopefuls falling in the under-40 age group.

Founder of water vending machine company, portfolio manager, charged in $275M Ponzi scheme
Founder of water vending machine company, portfolio manager, charged in $275M Ponzi scheme

"The greed and deception of this Ponzi scheme has resulted in the same way they have throughout history," said Daniel Brubaker, U.S. Postal Inspection Service inspector in charge.

Advisor moves: Raymond James, Wells Fargo reel in billion dollar-plus advisor teams
Advisor moves: Raymond James, Wells Fargo reel in billion dollar-plus advisor teams

Elsewhere, an advisor formerly with a Commonwealth affiliate firm is launching her own independent practice with an Osaic OSJ.

SPONSORED Delivering family office services critical to advisor success

Stan Gregor, Chairman & CEO of Summit Financial Holdings, explores how RIAs can meet growing demand for family office-style services among mass affluent clients through tax-first planning, technology, and collaboration—positioning firms for long-term success

SPONSORED Passing on more than wealth: why purpose should be part of every estate plan

Chris Vizzi, Co-Founder & Partner of South Coast Investment Advisors, LLC, shares how 2025 estate tax changes—$13.99M per person—offer more than tax savings. Learn how to pass on purpose, values, and vision to unite generations and give wealth lasting meaning