Four money management firms are under investigation by the U.K.'s Financial Conduct Authority for allegedly violating competition rules in equity markets, the FCA said in a statement Wednesday.
Artemis Investment Management, Hargreave Hale, Newton Investment Management and River & Mercantile Asset Management are accused of having exchanged information over share prices they were willing to pay in relation to one or more initial public offerings in 2014 and 2015, the FCA said.
"The sharing generally occurred on a bilateral basis and allowed firms to know the others' plans during the IPO or placing process when they should have been competing for shares," the FCA added in its statement. A spokeswoman declined to comment on which IPOs were involved.
According to the U.K. financial markets regulator, in 2015, Newton, Hargreave Hale and River & Mercantile disclosed and accepted information about the price they intended to pay for shares in relation to one IPO and a placing.
Separately, in 2014, Artemis and Newton shared information about the price they intended or were willing to pay for shares in relation to another IPO.
Newton's spokeswoman said in an emailed statement: "Newton has been cooperating fully with the FCA and will continue to do so until this matter reaches its conclusion. The investigation is focused on a very small number of Newton's U.K. equity-focused strategies, which can invest in small and midcap U.K. equities. There has to date been no loss to any investors as a result of the activity, and we do not anticipate any loss in the future."
Artemis, Hargreave Hale and River & Mercantile could not be reached to comment about the FCA's investigation by press time.
The U.K. regulator has given the money managers a chance to make written statements on the matter.
The regulator could choose to take action against the firms under the Financial Services and Markets Authority, the financial regulatory agency in Belgium that guards the integrity of financial markets in the European Union, but on its own the FCA does not have the power to enforce the competition laws at its disposal.
The spokeswoman declined to comment about whether the FCA will be taking action against individuals at the four firms. The timeline for the investigation is not specified, she said.
