Morocco watchdog fines brokerage over IPO trades

RABAT, March 17 (Reuters) - Moroccan market regulator CDVM fined brokerage Upline Securities after a probe revealed trading irregularities surrounding an initial public offering last year by state property firm CGI (CGI.CS), the CDVM said on Monday.

It said it would recommend to the government that Upline be barred from handling certain cash securities trades. It also named Safabourse as being at fault in the case and issued warnings to Attijari Intermediation and BMCE Capital Bourse.

The move came after the CDVM (Conseil Deontologique des Valeurs Mobilieres) examined the detail of the $480 million IPO in August 2007, the country's biggest share offering in years, and trades that took place afterwards.

"Inspection procedures were launched concerning the main brokerages that traded CGI stock -- Upline Securities, Safabourse, Attijari Intermediation, BMCE Capital Bourse and CFG Marches," CDVM said in a statement on its Web site.

It fined Upline 10 million dirhams ($1.37 million), CDVM said. Upline managers could not immediately be reached for comment late on Monday.

The watchdog also formally annulled another IPO, that of IT services provider GSI Maroc, and said it was sending the case to the judicial authorities.

GSI's listing was postponed in November after the CDVM said new information had come to light that made it hard to clarify the company's situation.

Morocco's small stock market has burst to life in recent years as financial sector reforms boosted liquidity and private sector growth picked up, boosting corporate profits.

A growing number of IPOs have been greeted with euphoric buying, sending listed stocks soaring on their market debut.

The benchmark MASI index is up 17 percent this year, compared to a 33 percent gain in 2007. (Reporting by Tom Pfeiffer, editing by Leslie Gevirtz)