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Corporate conductRulingAgainst
Morgan Stanley opened accounts for Jeffrey Epstein's trusts between 2015 and 2019
TORONTO/NEW YORK, Feb 18 (Reuters) - Morgan Stanley opened accounts for Jeffrey Epstein's trusts between 2015 and 2019, years after the financier was convicted and registered as a sex offender under a 2008 plea deal, documents released by the U.S. Justice Department show.
Morgan Stanley's opening of an account in 2019 came two years after the bank's risk officers had closed another Epstein trust account in 2017, according to the emails released in the documents by the DOJ.
In an email forwarded to Epstein dated April 17, 2015, Kahn wrote: "Morgan Stanley account is open and funded with 5,000,000."
A source familiar with the matter said that Morgan Stanley closed one of Epstein's accounts in 2017 after the bank notified him of its decision to end their banking relationship.
According to a February 6, 2016 email that appears at the end of a back‑and‑forth with Epstein, Kahn wrote that a "Morgan Stanley=existing brokerage account in stc name currently has approximately 17,250,=00(sic)", a possible reference to a Southern Trust account.
The emails made public by the DOJ, which published more than 3 million pages on January 30, 2026, show Epstein's associates and investment entities continued securing banking relationships at Morgan Stanley long after his 2008 conviction, underscoring how Wall Street managed a client whose reputational risks were widely known.
In an email forwarded to Epstein dated April 17, 2015, Kahn wrote: "Morgan Stanley account is open and funded with 5,000,000."
According to a February 6, 2016 email that appears at the end of a back‑and‑forth with Epstein, Kahn wrote that a "Morgan Stanley=existing brokerage account in stc name currently has approximately 17,250,=00(sic)", a possible reference to a Southern Trust account.
TORONTO/NEW YORK, Feb 18 (Reuters) - Morgan Stanley opened accounts for Jeffrey Epstein's trusts between 2015 and 2019, years after the financier was convicted and registered as a sex offender under a 2008 plea deal, documents released by the U.S. Justice Department show.
Morgan Stanley's opening of an account in 2019 came two years after the bank's risk officers had closed another Epstein trust account in 2017, according to the emails released in the documents by the DOJ.
The emails made public by the DOJ, which published more than 3 million pages on January 30, 2026, show Epstein's associates and investment entities continued securing banking relationships at Morgan Stanley long after his 2008 conviction, underscoring how Wall Street managed a client whose reputational risks were widely known.
Corporate conductSettlementAgainst
Morgan Stanley Smith Barney agreed to pay $35 million to settle SEC charges over failures to safeguard customers' personal information
Morgan Stanley Smith Barney to Pay $35 Million for Extensive Failures to Safeguard Personal Information of Millions of Customers.
The Securities and Exchange Commission today announced that Morgan Stanley Smith Barney LLC has agreed to pay a $1 million penalty to settle charges related to its failures to protect customer information, some of which was hacked and offered for sale online.
The SEC’s order finds that Morgan Stanley violated Rule 30(a) of Regulation S-P, also known as the “Safeguards Rule.” Morgan Stanley agreed to settle the charges without admitting or denying the findings.
Morgan Stanley Paying $13 Million Penalty for Overbilling Clients and Violating Custody Rule
SEC.gov | Morgan Stanley Paying $13 Million Penalty for Overbilling Clients and Violating Custody Rule
Without admitting or denying the findings that it violated various provisions of the Investment Advisers Act of 1940 and related rules, Morgan Stanley consented to the SEC’s cease-and-desist order and agreed to the $13 million penalty, a censure, and undertakings related to its fee billing and books and records practices.
Corporate conductSettlementAgainst
Morgan Stanley settles for $15 million penalty
Morgan Stanley Smith Barney pays $15 million to settle with the SEC over allegations that four financial advisers stole clients' funds.
Morgan Stanley Smith Barney will pay a $15 million penalty as part of a settlement with the Securities and Exchange Commission related to four financial advisers who stole millions of dollars of advisory clients' and brokerage customers' funds.
Morgan Stanley Smith Barney to pay $15M penalty to settle SEC charges
Morgan Stanley acknowledges that no tax deduction may be sought in connection with the payment of the forfeiture or fine components of the Total Financial Payment.
Morgan Stanley agrees to pay the Total Financial Payment to the United States Treasury no later than ten (10) business days after the Agreement is fully executed.
Morgan Stanley was hit with a $15 million fine from the U.S. Securities and Exchange Commission after four advisors were found to have stolen millions of dollars worth of client funds.
Payment must be made in one of the following ways: (1) Respondents may transmit payment electronically to the Commission, which will provide detailed ACH transfer/Fedwire instructions upon request; (2) Respondents may make direct payment from a bank account via Pay.gov through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or (3) Respondents may pay by certified check, bank cashier’s check, or United States postal money order, made payable to the Securities and Exchange Commission and hand-delivered or mailed to: Enterprise Services Center Accounts Receivable Branch HQ Bldg., Room 181, AMZ-341 6500 South MacArthur Boulevard Oklahoma City, OK 73169 Payments by check or money order must be accompanied by a cover letter identifying Morgan Stanley & Co. LLC and Morgan Stanley Smith Barney LLC as Respondents in these proceedings, and the file number of these proceedings; a copy of the cover letter and check or money order must be sent to Thomas P. Smith, Jr., Associate Regional Director, Securities and Exchange Commission, 100 Pearl Street, Suite 20-100, New York, New York 10004-2616.
The Securities and Exchange Commission today announced that Morgan Stanley Smith Barney LLC (MSSB) has agreed to settle charges that it provided misleading information to clients in its retail wrap fee programs regarding trade execution services and transaction costs.
SEC Charges Morgan Stanley Smith Barney With Providing Misleading Information to Retail Clients
Corporate conductSettlementAgainst
Morgan Stanley settles for $150 Million
California Attorney General Becerra announced a $150 million settlement against Morgan Stanley for misleading California teachers and workers with pensions.
Attorney General Becerra Announces $150 Million Settlement Against Morgan Stanley for Misleading California’s Teachers and Workers with Pensions | State of California - Department of Justice - Office of the Attorney General
Reproductive careConfirmedYou decide
Morgan Stanley covers U.S. employee travel for abortion services
Morgan Stanley will cover U.S. employees' travel for abortion services.
Morgan Stanley will cover U.S. employees' travel for abortion services -source
Climate & energySettlementAgainst
Morgan Stanley Capital Group Inc. agreed to pay $1,119,000 to resolve alleged violations of the Clean Air Act stemming from producing gasoline that did not meet fuel standards
– December 14, 2017) - Morgan Stanley Capital Group Inc. (MSCG) has agreed to pay a civil penalty of $1,119,000 to resolve alleged violations of the Clean Air Act (CAA) stemming from the production of gasoline that did not did not meet fuel standards.
Morgan Stanley Capital Group Inc. Clean Air Act Settlement | Enforcement | US EPA
– December 14, 2017) - Morgan Stanley Capital Group Inc. (MSCG) has agreed to pay a civil penalty of $1,119,000 to resolve alleged violations of the Clean Air Act (CAA) stemming from the production of gasoline that did not did not meet fuel standards.
STIPULATION OF SETTLEMENT AND ORDER WHEREAS Plaintiff United States of America, by authority of the Attorney General of the United States and acting at the request of the United States Environmental Protection Agency (“EPA”), filed a Complaint against Defendant Morgan Stanley Capital Group Inc. (“MSCG”) pursuant to Sections 211(d) and 205(b) of the Clean Air Act, 42 U.S.C. §§ 7545(d) and 7524(b), to recover penalties relating to Defendant’s production of reformulated blendstock for oxygenate blending (“RBOB”) that did not meet the applicable volatile organic compound (“VOC”) reduction standards of the EPA’s reformulated gasoline (“RFG”) program as required by Sections 211(c) and (k) of the Clean Air Act and 40 C.F.R. § 80.65(i)(3)(i); WHEREAS on June 2, 2015, and August 21, 2015, Defendant self-disclosed the violations alleged in the Complaint to the EPA under the EPA’s Incentives for Self-Policing: Discovery, Disclosure, Correction and Prevention of Violations (“Audit Policy”), 65 Fed.
Morgan Stanley Capital Group Inc. Clean Air Act Settlement | US EPA
– December 14, 2017) - Morgan Stanley Capital Group Inc. (MSCG) has agreed to pay a civil penalty of $1,119,000 to resolve alleged violations of the Clean Air Act (CAA) stemming from the production of gasoline that did not did not meet fuel standards.
Corporate conductAllegationAgainst
Morgan Stanley is accused of concealing misrepresentations
Morgan Stanley is accused of concealing misrepresentations that hid the most dangerous loans.
The complaint, filed in San Francisco Superior Court, alleges that Morgan Stanley violated the False Claims Act, the California Securities Law and other state laws by concealing or understating the risks of intricate investments involving large numbers of underlying loans or other assets.
“Morgan Stanley’s conduct in this case evidenced a culture of greed and deception that helped create a devastating economic crisis and crippled California’s budget,” said Attorney General Harris.
Morgan Stanley's Misrepresentations Concealed the Most Dangerous Loans 148.
As set forth herein , defendant Morgan Stanley was a major participant in the events leading up to the 2007-2008 financial crisis, including, of relevance to this actio n, creating, assemb ling and packaging risky structured finance securities.
Then-Attorney General Kamala Harris sued Morgan Stanley in 2016, claiming the investment company violated the False Claims Act and the state’s securities law when it put together and sold billions of dollars in toxic mortgage-backed securities.
Climate & energyConfirmedYou decide
Morgan Stanley loosens climate targets to 1.7C
Morgan Stanley loosened its climate target to 1.7 degrees Celsius, aligning with a lower ambition scenario requiring less emissions reduction.
For instance, Morgan Stanley loosened its target to align with the Paris Agreement’s maximum warming goal of 1.5 degrees Celsius to 1.7 degrees Celsius—“a lower ambition scenario requiring less emissions reductions by the bank,” the letter said.
Climate & energySettlementAgainst
Morgan Stanley Capital Group Inc. agreed to pay a civil penalty of $1,119,000 to resolve alleged violations of the Clean Air Act stemming from the production of gasoline that did not meet fuel standards
Morgan Stanley Capital Group Inc. Clean Air Act SettlementMorgan Stanley Capital Group Inc. (MSCG) has agreed to pay a civil penalty of $1,119,000 to resolve alleged violations of the Clean Air Act (CAA) stemming from the production of gasoline that did not did not meet fuel standards.
Morgan Stanley Capital Group Inc. Clean Air Act SettlementMorgan Stanley Capital Group Inc. (MSCG) has agreed to pay a civil penalty of $1,119,000 to resolve alleged violations of the Clean Air Act (CAA) stemming from the production of gasoline that did not did not meet fuel standards.
Corporate conductConfirmedAgainst
Morgan Stanley faces prosecution for securities fraud
Morgan Stanley can be prosecuted for federal securities law violations by the United States in the U.S. District Court for the Southern District of New York.
fede ral law or any violation of the anti-fraud provisions of the United States securities laws, regardless of whether the United States becomes aware of such a breach after the Term is complete, Morgan Stanley shall thereafter be subject to prosecution for any federal criminal violation of which the United States has knowledge, which may be pursued by the United States in the U.S. Di strict Court for the Southern District of New York or any other appropriate venue.
Agreement; (c) otherwise fails to completely perform or fulfill each of Morgan Stanley’s obligations under the Agreement; or (d) anyone working within Morgan Stanley’s Equity Capital Markets Group commits any felony under U.S. fede ral law or any violation of the anti-fraud provisions of the United States securities laws, regardless of whether the United States becomes aware of such a breach after the Term is complete, Morgan Stanley shall thereafter be subject to prosecution for any federal criminal violation of which the United States has knowledge, which may be pursued by the United States in the U.S. Di strict Court for the Southern District of New York or any other appropriate venue.
Privacy & surveillanceSettlementAgainst
Morgan Stanley agreed to pay a $60 million civil fine to resolve accusations concerning insufficient oversight of data centers
In October 2020, Morgan Stanley agreed to pay a $60 million civil fine https://www.reuters.com/article/us-usa-morgan-stanley-fine/morgan-stanley-to-pay-60-million-penalty-for-insufficient-oversight-of-data-centers-idUSKBN26T3A7 to resolve U.S. Office of the Comptroller of the Currency accusations concerning the incidents, including that its information security practices were unsafe or unsound.
In October 2020, Morgan Stanley agreed to pay a $60 million civil fine https://www.reuters.com/article/us-usa-morgan-stanley-fine/morgan-stanley-to-pay-60-million-penalty-for-insufficient-oversight-of-data-centers-idUSKBN26T3A7 to resolve U.S. Office of the Comptroller of the Currency accusations concerning the incidents, including that its information security practices were unsafe or unsound.
Morgan Stanley to pay $60 mln to resolve data security lawsuit
Morgan Stanley Unit To Settle Claims It Exposed Client Data
Community investmentConfirmedIn favor
Morgan Stanley combines resources for mental health
Morgan Stanley combines its resources with nonprofits to address mental health through growth capital and seed funding, reaching over 52 million children globally between 2020 and 2024.
The Alliance combines the resources and reach of Morgan Stanley with the knowledge and experience of distinguished nonprofits to address the mental health crisis through growth capital, capacity building, seed funding and thought leadership, reaching over 52 million children and their trusted adults globally between 2020 and 2024.
Corporate conductRulingAgainst
Morgan Stanley was fined by a U.S. regulator for failing to timely cancel or close out municipal securities transactions
NEW YORK, Feb 15 (Reuters) - A U.S. regulator on Thursday fined Morgan Stanley $1.6 million for failing to timely cancel or close out 239 failed inter-dealer municipal securities transactions, and take prompt steps to obtain control of hundreds of municipal securities that had been due for months.
NEW YORK, Feb 15 (Reuters) - A U.S. regulator on Thursday fined Morgan Stanley $1.6 million for failing to timely cancel or close out 239 failed inter-dealer municipal securities transactions, and take prompt steps to obtain control of hundreds of municipal securities that had been due for months.
Corporate conductConfirmedAgainst
Morgan Stanley faces recordkeeping failures
Morgan Stanley’s recordkeeping failures likely impacted the Commission’s ability to investigate securities law violations.
As a result, Morgan Stanley’s recordkeeping failures likely impacted the Commission’s ability to carry out its regulatory functions and investigate violations of the federal securities laws across these investigations.
Corporate conductConfirmedAgainst
Morgan Stanley reports results for Nov 30 fiscal year
Morgan Stanley reported financial results using a fiscal year ending November 30.
Morgan Stanley reported its financial results using a fiscal year ended November 30.
Labor & working conditionsOfficial statementAgainst
Morgan Stanley sponsored the IPO of Zijin Gold International Co.
In a separate deal covered in the investigation, Morgan Stanley sponsored the IPO of Zijin Gold International Co., Ltd. (Zijin Gold), whose parent company and certain subsidiaries are on the Uyghur Forced Labor Prevention Act (UFLPA) Entity List.
In a separate deal covered in the investigation, Morgan Stanley sponsored the IPO of Zijin Gold International Co., Ltd. (Zijin Gold), whose parent company and certain subsidiaries are on the Uyghur Forced Labor Prevention Act (UFLPA) Entity List.
Corporate conductConfirmedAgainst
Morgan Stanley incorporates UK bank in 1999
Morgan Stanley incorporated Morgan Stanley Bank in the UK in 1999.
In 1999, Morgan Stanley incorporated Morgan Stanley Bank in the UK and in 2000 Morgan Stanley Bank sought to become a member of the Visa organisation, which Visa refused.
Workplace equityConfirmedIn favor
Morgan Stanley says 40% of workforce is women
Morgan Stanley cited an employee survey to state that about 40% of its global workforce and 29% of its officers are women.
Citing an employee survey, Morgan Stanley said that around 40% of its global workforce and 29% of its officers — which include roles such as managing directors, executive directors and vice presidents — are women.
Corporate conductConfirmedAgainst
Morgan Stanley files complaint against Visa
Morgan Stanley submitted a complaint to the Commission and commenced High Court proceedings against Visa, claiming damages.
THE PROCEDURE (30) Morgan Stanley submitted a com plaint to the Commissi on in respect of Visa's conduct42 on 12 April 2000 and commenced proceedings against Visa before the High Court of Justice of England and Wales on 28 September 2000.43 44 Its claim before the High Court of Justice of England and Wales is similar to its complaint submitted to the Commission, save that it also claimed damages from Visa.
Climate & energyConfirmedYou decide
Rainforest Action Network targets Morgan Stanley
Rainforest Action Network announced Morgan Stanley is targeted to stop financing coal mining and coal-fired power.
Morgan Stanley continues to finance top producers of mountaintop removal coal, even as eleven of its competitors have committed to cut financing for the practice.
"Morgan Stanley has longstanding financing relationships withsome of the worst offenders from the global coal mining industry, including Peabody Energy, the world's largest private sector coal mining company," said Ben Collins, Senior Research and Policy Campaigner at RAN.
San Francisco - Today, Rainforest Action Network (RAN)announced that Morgan Stanley is the next major investment bank being targeted with a public campaign to demand that the bank commit to stop financing coal mining and coal-fired power.
Corporate conductConfirmedAgainst
Morgan Stanley shelved plastic pollution financing commitment
Morgan Stanley quietly discontinued its commitment to finance plastic pollution cleanup and prevention.
News emerged last week that Morgan Stanley had quietly shelved a central pillar of its sustainability strategy: a commitment to finance the cleanup and prevention of plastic pollution.
Climate & energyConfirmedYou decide
Morgan Stanley quits Net Zero Banking Alliance
Morgan Stanley quit the Net Zero Banking Alliance.
All six major US banks — JPMorgan Chase, Bank of America, Goldman Sachs, Citigroup, Morgan Stanley and Wells Fargo — have quit the Net Zero Banking Alliance, according to the new study from the Committee to Unleash Prosperity.
From Goldman Sachs to Morgan Stanley, many of the largest banks in the U.S. are quitting an international climate group amid rising political pressure as the nation enters a second Trump presidency.
Morgan Stanley on Thursday announced its departure from a coalition of banks that aims to target net-zero emissions through lending and investment, the fifth group to do so in recent weeks.
NEW YORK CITY (TNND) — Financial giant Morgan Stanley is the latest bank to depart the Net-Zero Banking Alliance (NZBA), a company spokesperson told The National News Desk (TNND) on Thursday.
"Investment bank Morgan Stanley said on Thursday it had decided to leave the Net-Zero Banking Alliance, becoming the latest U.S. lender to quit the sector's top global climate coalition
Morgan Stanley is leaving the Net-Zero Banking Alliance, the lender said on Thursday.
Community investmentConfirmedIn favor
Morgan Stanley supports children's health charities
Morgan Stanley Foundation and Morgan Stanley International Foundation support charities focused on children's health, including wellness, nutrition, mental health, and play.
The Morgan Stanley Foundation and the Morgan Stanley International Foundation supports charities focused on the fundamentals of children’s health, including wellness, nutrition, mental health and play.
Wages & economic policyConfirmedYou decide
Morgan Stanley publicly supports climate action
Morgan Stanley publicly supports addressing climate change and serving communities generously with expertise, time, and money.
For example, Morgan Stanley publicly supports addressing climate change, yet the Business Roundtable filed an amicus brief opposing the Securities and Exchange Commission climate risk disclosure rules,2 the Chamber opposed the Paris climate accord and BPI and FSF both lobbied the Securities and Exchange Commission to weaken proposed climate disclosure rules.3 And a Morgan Stanley value is serving communities generously with its expertise, time and money, yet ACT has drawn scrutiny for lobbying to lower taxes on foreign profits.4 Reputational damage stemming from these misalignments could harm shareowner value.
Privacy & surveillanceSettlementAgainst
Morgan Stanley reaches settlement after notifying states
Morgan Stanley notified states' attorneys general of two data security incidents more than three years ago, resulting in a settlement.
A class member in a $68.2 million settlement with Morgan Stanley over data security incidents has filed an objection in New York federal court ripping plaintiffs attorneys for their $20 million fee request, saying the deal "gives credence to the worst stereotypes of class action abuse."
Corporate conductAllegationAgainst
Morgan Stanley is accused of illegal conduct
Morgan Stanley is accused of illegal conduct pursuant to California Corporations Code section 25403(a).
Accordingly, Morgan Stanley is liable for the illegal conduct of the Controllees, and each of them , pursuant to Californi a Corporations Code section 25403(a).
COMPLAINT FOR
Corporate conductAllegationAgainst
Morgan Stanley is accused of under probe
Morgan Stanley is accused of being under probe for wealth management client vetting issues.
FINRA's investigation is particularly focused on the risk profiles of clients for whom Morgan Stanley has managed or executed trades, including inquiries about clients on its digital trading platform E*Trade, its private banking services, and its institutional securities group.
Morgan Stanley under probe for wealth management client vetting issues – report
Financial Industry Regulatory Authority (FINRA) is investigating Morgan Stanley over how the firm screened clients for money-laundering risks, the Wall Street Journal reported on Tuesday, citing people familiar with the matter.
A whopping 24% of Morgan Stanley international wealth-management accounts were labeled by the company as being high risk for money laundering, according to a 2023 document summarizing more than 46,500 clients viewed by the Journal.
Morgan Stanley Under Finra Scrutiny For Allegedly Flawed Vetting of Clients, Potential Money Laundering R - Benzinga
Morgan Stanley (NYSE:MS) is reportedly under investigation by the Financial Industry Regulatory Authority (FINRA) for potential money laundering risks associated with its clients.
Privacy & surveillanceRulingAgainst
Morgan Stanley faces ruling over Defendant
INCORPORATED Plaintiff Securities and Exchange Commission (“Commission”) having filed a Complaint in this action (“Complaint”) and Defendant Morgan Stanley and Co. Incorporated (“Defendant”) having (a) entered a general appearance, (b) consented to the Court’s jurisdiction over Defendant and the subject matter of this action, (c) consented to entry of this Final Judgment without admitting or denyng the allegations of the Complaint (except as to jurisdiction), (d) waived findings of fact and conclusions of law, and (e) waived any right to appeal from this Final Judgment; and the Commission having agreed that, on the basis of this Final Judgment, it will not institute a proceeding against Defendant pursuant to Sections 15(b), 15B, 15C, or 19(h) of the Securities Exchange Act of 1934 (the “Exchange Act”): I.
INCORPORATED Plaintiff Securities and Exchange Commission (“Commission”) having filed a Complaint in this action (“Complaint”) and Defendant Morgan Stanley and Co. Incorporated (“Defendant”) having (a) entered a general appearance, (b) consented to the Court’s jurisdiction over Defendant and the subject matter of this action, (c) consented to entry of this Final Judgment without admitting or denyng the allegations of the Complaint (except as to jurisdiction), (d) waived findings of fact and conclusions of law, and (e) waived any right to appeal from this Final Judgment; and the Commission having agreed that, on the basis of this Final Judgment, it will not institute a proceeding against Defendant pursuant to Sections 15(b), 15B, 15C, or 19(h) of the Securities Exchange Act of 1934 (the “Exchange Act”): I.
Corporate conductRulingAgainst
Morgan Stanley faces ruling over buy-side investors
The Commission found that these Morgan Stanley employees, in violation of their duties of confidentiality and Morgan Stanley’s policies, disclosed to certain buy-side investors non-public, potentially market-moving information, concerning impending “block trades” that the firm had been invited to bid on or was in the process of negotiating with the Selling Shareholders.
Morgan Stanley admitted to making false statements in connection with block trades from 2018 through August 2021. Its $249.4 million payment includes fines, restitution and the forfeiture of ill-gotten gains.
Morgan Stanley will pay millions settle SEC block trade probe
Morgan Stanley has agreed to pay a total of $249 million to settle a criminal investigation and a related Securities and Exchange Commission probe of the unauthorized disclosure of block trades to investors by the bank's supervisor for such trades and another employee, authorities said Friday.
Morgan Stanley shall not seek or accept directly or indirectly reimbursement or indemnification from any sour ce with regard to the penalty or disgorgement amounts that Morgan Stanley pays pursuant to this Agreemen t or any other agreement entered into with an enforcement authority or regulator, including th e SEC, concerning the facts set forth in the Statement of Facts.
Morgan Stanley has agreed to accept full responsibility for its conduct and resolve with the U.S. Securities and Exchange Commission (t he “SEC”) through an administrative Order Instituting Proceedings that will become e ffective on January 12, 2024 , relating to conduct described in the Statement of Facts, and has agreed to pay $138,297,046 in disgorgement and pre- judgment interest of $28,057,775; g.
Harmed Investor In the Matter of Morgan Stanley & Co. LLC, Admin.
On January 12, 2024, the Commission issued two related settled orders (collectively, the “Orders”) against Morgan Stanley & Co. LLC (“Morgan Stanley”) and Pawan Kumar Passi (“Passi”) (collectively, the “Respondents”).
The Commission found that these Morgan Stanley employees, in violation of their duties of confidentiality and Morgan Stanley’s policies, disclosed to certain buy-side investors non-public, potentially market-moving information, concerning impending “block trades” that the firm had been invited to bid on or was in the process of negotiating with the Selling Shareholders.
In the Orders, the Commission found that, from at least June 2018 through August 2021 (the “Relevant Period”), Passi, the former head of Morgan Stanley’s Syndicate Desk, and another employee perpetrated a fraud involving large blocks of stock that the investment banking firm purchased from investors (the “Selling Shareholders”).
The Commission further found that Morgan Stanley failed to enforce information barriers to prevent material non-public information involving the block trades from being discussed by the Syndicate Desk.
The Commission found that, by this conduct, Morgan Stanley generated more than $138 million in profits across 28 transactions.
In the Orders, the Commission found that, from at least June 2018 through August 2021 (the “Relevant Period”), Passi and another employee on Morgan Stanley’s Equity Syndicate Desk in the Americas (the “Syndicate Desk”) perpetrated a fraud involving large blocks of stock that the investment banking firm purchased from investors (the “Selling Shareholders”).
On January 12, 2024, the Commission issued two separate, but related, settled orders (collectively, the “Orders”) against Morgan Stanley & Co. LLC (“Morgan Stanley”)1 and Pawan Kumar Passi (“Passi”)2 (collectively, the “Respondents”).
According to the Order, by this conduct, Morgan Stanley generated more than $138 million in profits across 28 transactions.
SEC Charges Morgan Stanley and Former Executive Pawan Passi with Fraud in Block Trading Business
The SEC’s order concerning Morgan Stanley finds that the firm willfully violated Sections 10(b) and 15(g) of the Securities Exchange Act of 1934 and Rule 10b-5(b) thereunder, censures the firm, and orders it to pay approximately $138 million in disgorgement, approximately $28 million in prejudgment interest, and an $83 million civil penalty.
The SEC’s order further finds that Morgan Stanley failed to enforce information barriers to prevent material non-public information involving certain block trades from being conveyed by the equity syndicate desk, which sits on the private side of Morgan Stanley, to a trading division on the public side of the firm.
SEC.gov | SEC Charges Morgan Stanley and Former Executive Pawan Passi with Fraud in Block Trading Business
Workplace equitySettlementAgainst
Morgan Stanley settlement over faces discrimination claim
The monetary award was structured so that Allison Schieffelin – who initiated the EEOC's investigation by filing a charge of discrimination in 1998 – was paid $12 million; $2 million was to be spent by Morgan Stanley on new diversity initiatives in the division; and $40 million was earmarked for distribution to eligible claimants via a claims process to be administered by former federal Judge Abner Mikva as "special master.".
The monetary award was structured so that Allison Schieffelin who initiated the EEOC's investigation by filing a charge of discrimination in 1998 was paid $12 million; $2 million was to be spent by Morgan Stanley on new diversity initiatives in the division; and $40 million was earmarked for distribution to eligible claimants via a claims process to be administered by former federal Judge Abner Mikva as "special master." The three-year consent decree also provides for increased anti-discrimination training for associates and managers in IED and Morgan Stanley's hiring of an outside monitor to assess the company's compliance and field employee complaints.
The monetary award was structured so that Allison Schieffelin – who initiated the EEOC's investigation by filing a charge of discrimination in 1998 – was paid $12 million; $2 million was to be spent by Morgan Stanley on new diversity initiatives in the division; and $40 million was earmarked for distribution to eligible claimants via a claims process to be administered by former federal Judge Abner Mikva as "special master."
Workplace equitySettlementAgainst
Morgan Stanley settlement over workplace discrimination
As part of the settlement, at least $2 million will be provided for diversity programs designed to enhance the compensation and promotional opportunities for female employees within Morgan Stanley.
Morgan Stanley has agreed to pay $54 million to settle sex discrimination allegations brought against the company by the Equal Employment Opportunity Commission (EEOC).
EEOC AND MORGAN STANLEY ANNOUNCE SETTLEMENT OF SEX DISCRIMINATION LAWSUIT
As part of the settlement, at least $2 million will be provided for diversity programs designed to enhance the compensation and promotional opportunities for female employees within Morgan Stanley.
Wall Street-based Morgan Stanley is a global financial services firm and a market leader in securities, investment management and credit services, with more than 600 offices in 27 countries.
EEOC's lawsuit, filed on September 10, 2001, alleged that Morgan Stanley discriminated against women in its Institutional Equity Division (IED) with respect to promotion, compensation and the terms, conditions and privileges of employment.
WASHINGTON - The U.S. Equal Employment Opportunity Commission (EEOC) and Morgan Stanley (NYSE: MWD) today announced a $54 million settlement of a sex discrimination lawsuit under Title VII of the 1964 Civil Rights Act filed on behalf of a class of female officers and women eligible for officer promotion in the firm's Institutional Equity Division.
Commenting on the settlement, EEOC Chair Cari M. Dominguez, said: "We are pleased that Morgan Stanley worked cooperatively with us to resolve this litigation.
Commenting on the settlement, EEOC Chair Cari M. Dominguez, said: "We are pleased that Morgan Stanley worked cooperatively with us to resolve this litigation.
EEOC AND MORGAN STANLEY ANNOUNCE SETTLEMENT OF SEX DISCRIMINATION LAWSUIT
EEOC's lawsuit, filed on September 10, 2001, alleged that Morgan Stanley discriminated against women in its Institutional Equity Division (IED) with respect to promotion, compensation and the terms, conditions and privileges of employment.
As part of the settlement, at least $2 million will be provided for diversity programs designed to enhance the compensation and promotional opportunities for female employees within Morgan Stanley.
WASHINGTON - The U.S. Equal Employment Opportunity Commission (EEOC) and Morgan Stanley (NYSE: MWD) today announced a $54 million settlement of a sex discrimination lawsuit under Title VII of the 1964 Civil Rights Act filed on behalf of a class of female officers and women eligible for officer promotion in the firm's Institutional Equity Division.
Wall Street-based Morgan Stanley is a global financial services firm and a market leader in securities, investment management and credit services, with more than 600 offices in 27 countries.
EEOC FILES SEX DISCRIMINATION LAWSUIT AGAINST MORGAN STANLEY
"When she spoke out against the discrimination, Morgan Stanley made a bad situation worse by punishing her for exercising her federally protected rights," said the office's Regional Attorney Katherine Bissell.
The monetary award was structured so that Allison Schieffelin who initiated the EEOC's investigation by filing a charge of discrimination in 1998 was paid $12 million; $2 million was to be spent by Morgan Stanley on new diversity initiatives in the division; and $40 million was earmarked for distribution to eligible claimants via a claims process to be administered by former federal Judge Abner Mikva as "special master." The three-year consent decree also provides for increased anti-discrimination training for associates and managers in IED and Morgan Stanley's hiring of an outside monitor to assess the company's compliance and field employee complaints.
NEW YORK The U.S. Equal Employment Opportunity Commission (EEOC) announced today that a $40 million sex discrimination claim fund which was established pursuant to the $54 million landmark settlement last year with brokerage giant Morgan Stanley will be distributed to the 67 eligible discrimination victims who came forward to participate in the claims process.
NEW YORK – The U.S. Equal Employment Opportunity Commission (EEOC) announced today that a $40 million sex discrimination claim fund – which was established pursuant to the $54 million landmark settlement last year with brokerage giant Morgan Stanley – will be distributed to the 67 eligible discrimination victims who came forward to participate in the claims process.
The charges included claims that Morgan Stanley regularly excluded women from work-related outings, paid women less than male peers, and denied them warranted promotions.
The monetary award was structured so that Allison Schieffelin – who initiated the EEOC's investigation by filing a charge of discrimination in 1998 – was paid $12 million; $2 million was to be spent by Morgan Stanley on new diversity initiatives in the division; and $40 million was earmarked for distribution to eligible claimants via a claims process to be administered by former federal Judge Abner Mikva as "special master." The three-year consent decree also provides for increased anti-discrimination training for associates and managers in IED and Morgan Stanley's hiring of an outside monitor to assess the company's compliance and field employee complaints.
Morgan Stanley Ends Bias Suit The Morgan Stanley investment bank agrees to pay $54 million to end a sex bias lawsuit brought by the Equal Employment Opportunity Commission.