Reuters | Feb 24, 2023 06:15PM ET
By Saeed Azhar
(Reuters) -putting down for reporter to check background on Archegos-dg
Morgan Stanley (NYSE:MS) said it was cooperating with U.S. regulators over investigations into its block-trading practices and providing authorities with information, according to a filing on Friday.
The Wall Street firm added it could face civil claims from market participants who said they were harmed by the company’s practices.
Block trades are single orders for large trades, typically placed by institutional investors.
Morgan Stanley said it has been responding to subpoenas and other requests for information from the U.S. Attorney’s Office for the Southern District of New York and the enforcement division of the Securities and Exchange Commission. The authorities did not immediately respond to requests for comment.
“The investigations are focused on whether the firm and/or its employees shared and/or used information regarding impending block transactions in violation of federal securities laws and regulations,” the company said.
The bank said it has also has responded to demands from shareholders for records concerning the investigations.
The company also provided an update on a class action lawsuit brought by investors.
On Feb. 6, a New York state judge refused to dismiss a proposed class action against Morgan Stanley and other underwriters that helped the media company Viacom Inc sell $2.7 billion of stock in March 2021.
Investors claimed the bank and other underwriters should have disclosed risks associated with Archegos Capital Management, a $36 billion family office founded by New York investor Bill Hwang. Archegos collapsed in March 2021 after failing to meet margin calls on swaps on Viacom CBS and other stocks. Several large banks sustained substantial losses.
Get The News You Want
Read market moving news with a personalized feed of stocks you care about.
Get The App
Written By: Reuters
