MOODY'S Investors Service, one of Wall Street's major credit rating services, said yesterday that the US Justice Department had asked it for information on its rating practices.

The investigation, which comes as Moody's faces increasing criticism of its business practices, is believed to be the first such investigation of how a rating agency wins business from major bond issuers.

"What they say is that they're conducting a preliminary investigation of certain business practices in the rating industry related to asset backed securities, mortgage backed securities, municipal securities and the practice of unsolicited ratings," Mr George Fasel, managing director of communications at Moody's, said.

The Wall Street Journal reported that the investigation centred on whether Moody's attempted to pressure bond issuers improperly to hire the rating agency to evaluate their debt at the risk of facing negative comments and ratings.

It also quoted a Justice Department spokeswoman who, while declining to comment specifically about Moody's said the department was looking at anti competitive practices in the bond rating industry".