Three Morgan Stanley Advisors Clear Records of Back-Office Mistake

Posted on April 11th, 2022 at 1:08 PM
Three Morgan Stanley Advisors Clear Records of Back-Office Mistake

From the Desk of Jim Eccleston at Eccleston Law:

A Financial Industry Regulatory Authority (FINRA) arbitration panel has expunged the records of three advisors who are part of a large Morgan Stanley team. The disclosure had related to their purported liability for a customer complaint pertaining to a back-office mistake over a misvalued stock certificate.


According to the FINRA panel, the advisors were “not responsible” for the mistake that occurred in Morgan Stanley’s back-office. The panel reasoned that the complaint ought to be removed because it was “factually impossible or clearly erroneous”, according to the award. The claim was filed in June 2021, which was six months after Sean’s team departed UBS for Morgan Stanley.


According to the award, customers had initially discovered old paper stock certificates and sought to have them valued and deposited at Morgan Stanley. However, Morgan Stanley’s back-office “mistakenly valued” the certificates at more than $1 million and subsequently sold them. The certificates eventually were deemed “worthless”, which prompted Morgan Stanley to reverse the sale and ensure their customers were “made whole”, according to the award. Nevertheless, the customers filed a lawsuit against Morgan Stanley and the advisors, but the customers later settled with the firm for “a nominal sum” of $20,000 in a settlement that did not involve the advisors, according to BrokerCheck.


Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

 
 

Tags: eccleston law, finra, morgan stanley

Return to Archive

TESTIMONIALS

Previous
Next

Thank you so very much for your guidance, patience, and expertise.

Beth and Steve K.

LATEST NEWS AND ARTICLES

February 4, 2025
Wells Fargo Faces $3.37 Million FINRA Award Over Alleged Elder Exploitation

A FINRA arbitration panel has ordered Wells Fargo Clearing Services and its advisor, Stephen L. Smith, to pay approximately $3.37 million in damages to the estate of Genell Mathis.

February 3, 2025
Bank of America Agrees to Consent Order Over Anti-Money-Laundering Deficiencies

Bank of America Corp. has entered into a consent order with the Office of the Comptroller of the Currency (OCC) to address deficiencies in its anti-money-laundering (AML) and sanctions compliance programs.

January 31, 2025
UBS Settles FINRA Claims Over Supervision of Short-Term Preferred Stock Trades

According to AdvisorHub, UBS Wealth Management USA’s broker-dealer has agreed to pay $3.5 million in sanctions over allegations of supervisory failures related to short-term trading of syndicate preferred stock.