The European Securities and Markets Authority (ESMA) has fined three subsidiaries of Fitch Ratings in the U.K., France and Spain a combined €5.1 million after finding that they violated conflict of interest rules in connection with rating activities carried out between 2013 and 2015.
The conflicts involved rating firms where a major Fitch shareholder also sat on the boards of the companies being rated, violating rules that were adopted by the ESMA in 2013.
The U.K. division faced the largest fine at €3.2 million, Fitch Spain was fined €1,125,000 and Fitch France received a €812,500 fine.
The ESMA noted that the penalties took into account the fact that the firms have since voluntarily taken measures to prevent similar violations in the future.
The three firms still have the right to appeal the ruling. However, Fitch has issued a statement saying that it “welcomes being able to now put this matter behind us, as it relates to breaches that occurred between 2013 and 2016.”
The rating agency said that the breaches did not impact its ratings, and that its interpretation of the rules “was made in good faith.”
“We no longer have single individual shareholders who may be in a position to sit on the boards of rated entities. We remain committed to maintaining high standards of operations and full compliance with all regulatory rules and requirements,” it added.