Investigation: Morgan Stanley Sales Violations for Puerto Rico Residents

Stoltmann Law Offices is investigating Morgan Stanley for sales practice violations after the firm reached a $4.7 million settlement with the state of Mississippi. The consent order suggested that client investment objectives and risk tolerance information were entered incorrectly while transferring numerous client accounts from Smith Barney to Morgan Stanley. “In order to transfer the accounts from Smith Barney to Morgan Stanley, new customer information was required to be entered into Morgan Stanley’s system. This information included customer investment objectives, risk tolerances, financial and other personal information used, in part, to aid in the determination of whether certain investments…were suitable for the customer.” Morgan Stanley and its brokers may not have conducted due diligence for its Puerto Rico customers to ascertain their appropriate investment objective and risk tolerance. The sales practices uncovered by the state of Mississippi appear to be consistent with these findings. Stoltmann Law Offices is also investigating whether Morgan Stanley failed to supervise its broker in conjunction with potentially unsuitable investment advice being made to its clients from Puerto Rico. If you were sold investments by Morgan Stanley brokers, please call us today. 312-332-4200.

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