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Investors in Morgan Stanley Shrug at News FINRA Has Fined Firm $1M, Orders Restitution of $188K

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The Financial Industry Regulatory Authority (FINRA) announced today that it has fined Morgan Stanley (NYSE: MS) Smith Barney LLC and Morgan Stanley & Co. LLC $1 million and ordered $188,000 in restitution plus interest for failing to provide best execution in certain customer transactions involving corporate and agency bonds, and failing to provide a fair and reasonable price in certain customer transactions involving municipal bonds. The requirement to pay restitution is in addition to restitution that Morgan Stanley paid previously to customers for transactions covered by this settlement.

FINRA found that Morgan Stanley failed to use reasonable diligence to ensure that the purchase or sale price to the customer was as favorable as possible under current market conditions in 116 customer transactions involving corporate and agency bonds. Additionally, in 165 transactions involving municipal bonds, Morgan Stanley failed to purchase or sell bonds at prices reasonably related to the fair market value of the subject security.

Posted-In: News Legal


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