March 5, 2014 View entire issue of ANO         Close 

Morgan Stanley Settles with SEC for $275 Million

Morgan Stanley has agreed to a $275 million deal with the U.S. Securities and Exchange Commission to settle allegations that it traded toxic subprime mortgage bonds, HousingWire reported Feb. 26. The trades date back to 2007.

The agreement does not require Morgan Stanley to concede any wrongdoing or violation of regulations, although that might change — the SEC commissioners have not yet approved the deal.

Morgan Stanley is one of several Wall Street banks under SEC investigation related to residential mortgage bond underwriting. The bank already has agreed to pay $1.25 billion to the Federal Housing Finance Agency to settle claims it misled investors in the sale of mortgage-backed securities prior to the housing crisis.

Morgan Stanley reported that the proposed $275 million settlement would come out of the firm’s 2013 earnings and include fines and penalties, as well as all the bank’s proceeds from the toxic bonds it sold.

Share |
Email to a FriendPrinter-Friendly