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ESMA Slaps This Fintech with €420K Fine for Name-Dropping Violations

Pat Crawley

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2025-04-07T11:30:32.633+02:00

Monday, 07/04/2025 | 09:30 GMT by Damian Chmiel

The regulator has fined Italian credit rating agency Modefinance for falsely suggesting ESMA had certified its rating models.
The misleading statements appeared on the company’s websites for three years, potentially affecting investor decisions.

Inside ESMA headquarters — Inside an ESMA office; Source: ESMA

The European Securities and Markets Authority (ESMA) has imposed a €420,000 fine on Modefinance for improperly suggesting the regulator had endorsed its credit rating activities, the EU financial markets watchdog announced Monday.

ESMA Fines Modefinance €420,000 for Misleading Statements

The Italian credit rating agency published statements on its websites between September 2018 and October 2021 claiming ESMA had “certified” or “validated” models used in its scoring and credit rating activities, according to the regulator’s findings.

Verena Ross, the Chairwoman of ESMA

“Modefinance used ESMA’s name to incorrectly suggest ESMA’s endorsement of its credit rating activities,” said Verena Ross, ESMA Chairwoman. “This could mislead investors and could have an impact on the proper functioning of EU financial markets.”

ESMA determined the breach of the Credit Rating Agencies Regulation resulted from negligence by Modefinance. The regulator considered both aggravating and mitigating factors in calculating the fine amount and issued a public notice alongside the monetary penalty.

The Credit Rating Agencies Regulation explicitly prohibits firms from using ESMA’s name in ways that indicate or suggest endorsement or approval of credit ratings or related activities.

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ESMA Fines Modefinance €420,000 for Misleading Statements

Verena Ross, the Chairwoman of ESMA

The Credit Rating Agencies Regulation explicitly prohibits firms from using ESMA’s name in ways that indicate or suggest endorsement or approval of credit ratings or related activities.

Recent Regulatory Actions

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Damian’s adventure with financial markets began at the Cracow University of Economics, where he obtained his MA in finance and accounting. Starting from the retail trader perspective, he collaborated with brokerage houses and financial portals in Poland as an independent editor and content manager. His adventure with Finance Magnates began in 2016, where he is working as a business intelligence analyst.