SEC kicks off insider trading investigation into S&P downgrade

Steven Nelson Associate Editor
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The Securities and Exchange Commission is asking Standard & Poor’s to provide the names of employees who were aware of the credit agency’s impending downgrade of U.S. government debt ahead of its public announcement last Friday.

Financial Times reports that the SEC’s examination staff is looking into the possibility of insider trading.

Last Thursday, the Dow Jones Industrial Average dropped by 512 points ahead of the downgrade announcement. The decline was the largest since 2008.

A source informed the Financial Times that the SEC is not currently aware of any evidence that news of the downgrade leaked before it was announced.