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The corporate regulator is questioning whether Australia's liberal rules for capital raisings have created an environment that favours a select club of stockbrokers and investors, and flagged plans for tougher scrutiny of debt markets and large share sales. The Australian Securities and Investments Commission's 64-page report into the little-understood mechanics of how stock is allocated to investors when companies raise capital is the latest probe into whether "market norms" are in the best interests of all investors.It comes after ASIC and the Australian Consumer Competition Commission shocked sharemarket participants by launching legal actions against ANZ and its joint lead underwriters in relation to how leftover shares from a $2.5 billion share sale were sold in 2015. JPMorgan, Citigroup and Deutsche where the joint underwriters but JP Morgan is not part of the criminal action after it co-operated with the regulator. ASIC commissioner Cathie Armour says there is concern about whether conflicts over capital raisings are being managed appropriately. Ryan Stuart report has split market players, with some saying it shows there is no real concern with the system, while others are citing it as proof of a murky system where stockbrokers, investment bankers and large fund managers benefit at the expense of others.ASIC commissioner Cathie Armour asked whether shares were being sold too cheaply after the regulator conducted a study of 200 of the largest equity placements over four years and found the median gain in the share price one day after the placement was 4.1 per cent. for a quick raising with little risk for the institution was a decent amount of benefit for issuers to be paying away," Ms Armour told The Australian Financial Review."When they are doing these deals they are supposed to be acting for the client and the value transfer does seem concerning and raises red flags about whether conflicts are being managed appropriately."Ms Armour said ASIC still had work to do to adjust for the prevailing conditions of the capital raisings but said the figures suggested: "issuers were not driving a hard enough bargain".Stamp out the conflicts The report is the latest in a concerted effort from the regulator to stamp out rampant conflicts of interest in capital markets.