BBC: 10 Wall Street banks fined for promising positive research to Toys R Us to win business
Banks fined by US regulators over Toys R Us research
12/11/2014
US regulators have fined 10 Wall Street banks for promising positive research to Toys R Us in exchange for winning its business.
FINRA says analysts at banks trying to win Toys R Us business offered to give the retailer positive ratings.
The US Financial Industry Regulatory Authority (FINRA) alleges the banks offered a favourable rating to the US toy retailer in return for being employed on its 2010 stock offering.
The banks include Citigroup, Goldman Sachs, JP Morgan, Credit Suisse and Barclays.
They were fined a total of $43.5m.
"FINRA's research analyst conflict of interest rules make clear that firms may not use research analysts or the promise of offering favorable research to win investment banking business," said Susan Axelrod in a statement.
Yet "each of these firms used their analyst to solicit investment banking business from Toys R Us and offered favorable research," she continued.
Toys R Us later withdrew its public stock offering in 2013 amid declining sales.
http://www.bbc.com/news/business-30438919
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