Wall Street’s self-regulator is looking into whether research analysts are participating in pitches to win business underwriting initial public offerings, according to a person familiar with the matter.
Bloomberg News reports that the Financial Industry Regulatory Authority has requested information from several firms, said the person, who asked not to be identified because the probe may not result in a formal investigation.
The person didn’t say which firms were queried.
Since the dot-com bust a decade ago, investment bankers have been restricted from arranging communications between analysts, who provide recommendations to investors, and the companies they seek business from. The JOBS Act, passed last year, loosens those regulations when banks are dealing with companies with less than $1bn in annual revenue.
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image: © Jan Krömer