J.P.
Morgan Chase |
Also Read
|
Morgan Stanley is one of the largest investment banking
firms in USA. The global securities market is one of Morgan Stanley’s
primary business arenas. The firm serves both individual and
institutional investors. Along with several other high-profile
firms, Morgan Stanley has recently endured a number of questions
about conflicts of interest and potential fraud.
When was the possible fraud discovered ?
Top Wall Street firms have recently been required to pay large
fines to regulators for alleged partiality in their stock
reports to investors. In December 2002, a preliminary agreement
was reached with 12 U.S. investment banks in which they agreed
to pay a combined total of over 1 billion dollars. The
Securities and Exchange Commission (SEC) and state regulators
brought accusations against the banks in the preceding months,
alleging that investment banks had let conflicts of interest
color their stock reports.
Morgan Stanley has also been individually targeted by the
world’s leading luxury item maker, LVMH. The leadership at LVMH
has accused Morgan Stanley of allowing a conflict of interest to
interfere with its research reporting. Gucci, a long-time rival
of LVMH, has close ties with Morgan Stanley. While LVMH claims
that this relationship caused Morgan Stanley to unfairly spin
its stock reports to investors, Morgan Stanley is vehemently
denying any accusation of fraud. The lawsuit by LVMH was filed
in a French court in November.
What type of fraud is alleged to have been committed ?
The charges filed by the SEC and state regulators against a host
of investment banks are roughly synonymous to the accusations
against Morgan Stanley by LVMH. Both claim that conflicts of
interest have contributed to dishonest stock reports to
investors. If LVMH wins its case against Morgan Stanley, it will
be because it shows convincing evidence that the securities firm
put its interest in Gucci ahead of its duty to present investors
with an accurate picture of stocks’ value.
Return
to the Stock Fraud Index
|
Merill
Lynch |
UBS Warburg |
Lehman Brother |
Alliance capital |
Morgan Stanley |
Credit Suisse |
Piper Jaffray |
|
|
|
Contact Us: 209, Indulal Commercial Complex, L.
B. Shastri Road, Navi Peth,Pune - 411030 indiaforensic@gmail.com |