Andrew Monk, chief executive of VSA Capital, said small-cap brokers are under increasing financial pressure, which could be hindering their ability to regulate the market.
“The broking industry has undergone massive change and every broker is desperate to get deals away as it’s the only way to survive because of the total collapse of the secondary [market]. Everyone has to do primary deals [floats] to survive and so the ability to say ‘no’ becomes very difficult.”
Monk added: “AIM has become very much a box ticking game (with a lot of boxes to tick) and what this loses is the old fashioned “sniff test”, the gut feeling, the experienced eye that used to be able to say that something doesn’t feel quite right.
“There will always be people who try and take advantage of capital markets whatever rules are in place. But no one makes money telling people to sell or not do a deal – so no one will stop it.”
