FleetBoston Financial Corp., the seventh-biggest U.S. bank, is close to settling a probe into Robertson Stephens’ role in initial public offerings during the Internet boom, the company said in a regulatory filing.
FleetBoston, which bought Robertson Stephens in 1998 and shut down the unprofitable investment-banking unit in July, said it’s in talks with the U.S. Securities and Exchange Commission and the enforcement arm of the NASD over final details. FleetBoston set aside money for the settlement in the second quarter, spokesman Jim Mahoney said, declining to say how much it may cost.
Regulators have been investigating Wall Street firms on issues ranging from whether they gave favored customers unfair access to IPO shares to whether they used biased stock research to attract investment-banking business. Fleet hasn’t detailed the object of the SEC and NASD probes.
“This is one of several clouds hanging over the company and to the extent that this puts this behind them, it’s a positive,” said Jason Goldberg, an analyst at Lehman Brothers Inc. who has an “equal weight'” rating on the stock and doesn’t own the shares.
SEC investigators told Goldman Sachs Group Inc. and J.P. Morgan Chase & Co. this month that they plan to ask the agency to file stock-fraud and market-manipulation charges for allotting IPO shares to investors who promised to buy more stock later at a higher price.