Moody’s has initiated an external review of its ratings of $4bn of complex debt products after revelations that the agency had awarded incorrect ratings because of a bug in its computer models.

Charles Schumer, the New York senator, called Wedesday for the Securities and Exchange Commission to investigate the matter, which triggered a fall of 16 per cent in its share price. Mr Schumer also said, if a probe proved mistakes had occurred, that the US regulatory agency should impose “appropriate sanctions” in the form of fines.