Let us now praise the Financial Times for its investigation of Moody’s, which has now, at last, resulted in an SEC investigation of one of the credit-ratings firms at the heart of the financial crisis.

Interesting how a little investigative journalism can send the dominos tumbling. We praised the FT way back in May 2008 for its story on how Moody’s covered up erroneous AAA ratings it had given to something called constant-proportion debt obligations in 2007.

The SEC finally got around to sending a Wells Notice to Moody’s on March 18. Moody’s CEO sold $4.3 million worth of his company’s shares later that day, though it says the sale was planned for a month. Warren Buffett sold $30 million worth of Moody’s beginning a day later. Coincidence? Here’s The New York Times:

Berkshire did not return a call seeking comment about its sales.

It’s worth noting that the blog Zero Hedge broke this news over the weekend after Moody’s got around to disclosing it in a filing. I note that, but nobody else does. Zero Hedge is this site that everybody reads and almost nobody acknowledges, in part because of its unfortunate habit of interspersing its good stuff with wild-eyed conspiracy posts.

Reading the Times story, it looks as though Moody’s is conceding that what the FT wrote is true:

Moody’s hired an outside law firm to investigate the matter, and subsequently took disciplinary actions that included terminations, according to Mr. Adler. He declined to provide further detail.

But McClatchy reports otherwise:

Rather than have its own compliance office investigate, however, Moody’s hired Wall Street law firm Sullivan & Cromwell to pursue the newspaper’s allegation, which allowed it to maintain attorney-client privilege if litigation resulted.

The law firm disproved the allegation, Mirenda said, but it found that a Moody’s European ratings surveillance committee had violated the internal Code of Professional Conduct. This information was shared with regulators and made public on July 1, 2008, he said.

But:

The SEC thinks the error in the European ratings rendered Moody’s application in June 2007 to register as a nationally recognized statistical organization “false and misleading.”

I’ve got a question out to the FT on this and will update when I hear back.

UPDATE: An FT spokeswoman said the paper stands by its story, and Alphaville editor Paul Murphy called me to give some background on the piece. More here.

If you'd like to help CJR and win a chance at one of 10 free print subscriptions, take a brief survey for us here.

Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.