NOTICE TO MORGAN STANLEY CLIENTS: Klayman & Toskes, P.A. Announces Investigation of Morgan Stanley Following $8 Million in SE...
February 21 2017 - 5:34PM
Business Wire
The Securities Arbitration Law Firm of Klayman & Toskes,
P.A.,(K&T) www.nasd-law.com, announces an investigation into
sales practice violations by Morgan Stanley (NYSE:MS) following $8
million in fines levied by the Securities Exchange Commission (SEC)
related to Exchange Traded Funds (ETFs).
On February 14, 2017, the SEC imposed a Cease and Desist Order
and Remedial Actions against Morgan Stanley for sales practice
violations related to recommended investments in single-inverse
ETFs for advisory clients in non-discretionary accounts. According
to Morgan Stanley compliance procedures, recommended investments in
single-inverse ETFS had two requirements:
- Advisory clients were required to sign
Client Disclosure Notices which detailed the risks associated with
the investment; and
- Morgan Stanley supervisors were
required to review the risky transactions for suitability based on
client profile.
The SEC examination determined deficiencies were found in the
supervisory procedures related to record keeping and the
determination of “suitability” in advisory clients’
non-discretionary accounts. No Client Disclosure Notices were
signed for these risky transactions for nearly 44% of the
non-discretionary advisory accounts at Morgan Stanley. The
supervisory review was considered “deficient or non-existent” for
advisory clients who did not have a signed Client Disclosure
Notice.
The sole purpose of this release is to investigate Morgan
Stanley’s sales practices related to single-inverse exchange traded
funds, which were supposed to be monitored on a daily basis and
only considered suitable as a part of a hedging strategy. Morgan
Stanley’s sales practice violations may include misrepresentations
and omissions of material facts, conflicts of interest, unsuitable
investment advice, and the failure to supervise financial advisor
recommendations concerning these risky transactions. Current and
former Morgan Stanley customers who have information
about the firm’s sales practices are encouraged to contact Lawrence
L. Klayman, Esq. or Raymond Gentile, Esq.
of Klayman & Toskes, P.A. at (888)
997-9956, or visit our website at www.nasd-law.com.
About Klayman & Toskes,
P.A.
K&T is a leading national securities law firm which
practices exclusively in the field of securities arbitration and
litigation, on behalf of retail and institutional investors
throughout the world in large and complex securities matters. The
firm represents high net-worth, ultra-high-net-worth, and
institutional investors, such as non-profit organizations, unions,
public and multi-employer pension funds. K&T has office
locations in California, Florida, New York and Puerto Rico.
Destination:
http://nasd-law.com/notice-to-morgan-stanley-clients-klayman-toskes-p-a-announces-investigation-of-morgan-stanley-following-8-million-in-sec-fines-for-exchange-traded-fund-violations/
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Klayman & Toskes, P.A.Lawrence L. Klayman,
Esq.,Toll Free: 888-997-9956orRaymond Gentile, Esq.,Toll
Free: 888-997-9956info@nasd-law.com
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