NASD opens door to profit for brokers and IPO's.

Financial News, March, 2004

A little-noticed securities-rule change that appears to run counter to the recent clean-up campaign on Wall Street could make it easier for investment bankers and dealers to profit from popopular initial public offerings that their own firms to the market.The National Association of Securities Dealers tightened up an exsisting rule under which a securities firm may not sell IPO shares to outside accounts in which any 'restricted' people -- such as employees of the firm or a close relative -- have a beneficial interest.

But in the process, the NASD, with the approval of the SEC, added an exception: The prohibition would be waived as long as these restricted people do not add up to more than 10% of an investment accounts ownership.