(September 7 – 16:45 ET) – The Securities and Exchange Commission today filed an administrative proceeding against a registered Canadian investment advisor, F.W. Thompson, and its principal, Frederick Thompson, for failing to allocate initial public offerings equitably among its clients.

Without admitting or denying the commission’s findings, F.W. Thompson and Frederick Thompson agreed to an order censuring each of them, and a cease and desist order. The firm agreed to pay a civil penalty of US$100,000.

According to the SEC’s order, from January 1996 through August 1997, Ontario-based F.W. Thompson allocated IPO shares, including “hot IPOs,” through an ad hoc process that favored certain clients over others. The firm had no written procedures, guidelines or policies governing IPO allocations, and failed to disclose to its clients its allocation practices.

The SEC says that both Canadian and U.S. clients were affected by this allocation favoritism. It also notes that the matter was discovered during an onsite compliance examination conducted jointly by the SEC and the Ontario Securities Commission.
-IE Staff