Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



FINRA Fines Morgan Stanley $1 Million

The Financial Industry Regulatory Authority (FINRA) has fined Morgan Stanley (NYSE: MS  ) $1 million for an alleged failure to ensure the best prices and execution of transactions involving certain customers in a total of 281 different transactions involving agency, corporate, and municipal bonds, FINRA announced Thursday.

FINRA cited 116 instances involving corporate and agency bonds where it said "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." There were also 165 municipal bond transactions where Morgan Stanley allegedly did not buy or sell the products at prices "reasonably related" to the fair market value of the security in question.

Morgan Stanley neither admitted nor denied the charges, but consented to the entry of FINRA's findings.

In addition to the $1 million fine, Morgan Stanley will pay $188,000 in restitution and interest to clients.

Thomas Gira, executive vice president of FINRA market regulation, was quoted in FINRA's statement as saying that "Firms must ensure that customers who buy and sell securities ... receive execution prices that are consistent with prices available in the marketplace."  He said that FINRA "will continue to sanction firms ... and will require firms that violate such standards to reimburse customers." FINRA is an independent regulator of securities firms doing business in the United States. Its core mission is to "pursue investor protection and market integrity."

This is at least the second time in the last two years that Morgan Stanley has been fined for its alleged failure to comply with "fair pricing standards." It received another $1 million fine from FINRA and was ordered to provide $371,000 in restitution in November 2011 for allegations related to "excessive markups and markdowns charged to customers on corporate and municipal bond transactions."


Read/Post Comments (0) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2607197, ~/Articles/ArticleHandler.aspx, 9/30/2016 9:47:03 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,272.34 128.89 0.71%
S&P 500 2,163.04 11.91 0.55%
NASD 5,292.69 23.54 0.45%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/30/2016 9:31 AM
MS $31.32 Up +0.28 +0.90%
Morgan Stanley CAPS Rating: ***