MANHATTAN (CN) – Moody’s Investors Services fired an employee for speaking out about the company’s preferential system of upgrading stock ratings, former vice president and senior analyst Paul Bienstock alleges in a federal whistleblower action.
Bienstock says he pitched a recommendation to upgrade the rating of Express Scripts stock based on thorough research. Moody’s is one of the leading sources of credit ratings, research and risk analysis.
After his presentation, the ratings committee voted 5-2 to boost the rating.
Patrick Finnegan, Bienstock’s managing director, was one of the two votes against the recommendation. When Bienstock asked why he didn’t vote for the upgrade, Finnegan allegedly responded, “Express Scripts doesn’t pay us and we don’t cover their issues. They don’t visit us nd they don’t deserve our upgrade.”
“Bienstock and all others present were shocked and mortified that Finnegan would make such ethically sensitive and questionable public proclamations,” the plaintiff claims.
Bienstock says he protested the remarks, but Finnegan dismissed his objections “in his typical controlling, monologue fashion.”
He claims Finnegan then intimated the other subordinates to switch their votes on a re-vote, so that Bienstock was the lone vote for the ratings change.
“The only difference between vote #1 and vote #2 was the fifteen minutes of venomous, opinion-based terrorization by Finnegan to strong-arm Bienstock’s fellow rating committee members and subordinates to vote with Finnegan and against the rating upgrade for Express Scripts,” the suit states.
The plaintiff says he complained to Moody’s Compliance Department and was canned.
He demands $5 million, plus punitive damages. His attorney is Jonathan Sack with Sack & Sack.