{"id":6201,"date":"2017-09-25T16:41:28","date_gmt":"2017-09-25T21:41:28","guid":{"rendered":"https:\/\/www.institutionalinvestorsecuritiesblog.com\/?p=1792"},"modified":"2022-05-19T09:50:57","modified_gmt":"2022-05-19T14:50:57","slug":"morgan-stanley-pay-13m-improper-supervision-unit-investment-trust-sales","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/morgan-stanley-pay-13m-improper-supervision-unit-investment-trust-sales\/","title":{"rendered":"Morgan Stanley to Pay $13M Over Improper Supervision of Unit Investment Trust Sales"},"content":{"rendered":"<p>\t\t\t\tFINRA is ordering Morgan Stanley Smith Barney LLC (MS) to pay about $9.8M in restitution to and a $3.25M fine for purportedly not properly supervising hundreds of financial representatives who sold short-term trades of UITs. The firm settled without denying or admitting to the regulator\u2019s charges. <\/p>\n<p>According to the self-regulatory organization, from 2\/2012 through 6\/2015, the brokerage firm\u2019s representatives effected short-term UIT rollovers, including a number of them more than 100 days prior to maturity, in customer accounts. FINRA said that the firm did not <a href=\"https:\/\/www.investorlawyers.com\/failure-to-supervise.html\">properly supervise <\/a>these reps, when they engaged in the UIT sales, nor did it properly train them regarding the investments. It also purportedly failed to give supervisors adequate guidance about how to study transactions for signs of unsuitable short-term trading. Morgan Stanley is accused of failing to put into effect a system \u201cadequate\u201d enough to identify short-term UIT rollovers and of not providing supervisory assessment for UIT rollovers before execution. <\/p>\n<p><strong>UITs<\/strong><br \/>\nUnit investment trusts are investment companies that offer units in a securities of a portfolio. They are subject to termination on a certain maturity date, usually after 15 months or 24 months. They typically come with certain fees, including a creation fee and a deferred sales charge. According to FINRA, when a new UIT compels a customer to be pay higher sales charges over time, this could be a red flag indicating suitability issues. <\/p>\n<p> <a href=\"https:\/\/www.investorlawyers.com\/blog\/morgan-stanley-pay-13m-improper-supervision-unit-investment-trust-sales\/#more-6201\" class=\"more-link\">Continue Reading \u203a<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>FINRA is ordering Morgan Stanley Smith Barney LLC (MS) to pay about $9.8M in restitution to and a $3.25M fine for purportedly not properly supervising hundreds of financial representatives who sold short-term trades of UITs. The firm settled without denying or admitting to the regulator\u2019s charges. According to the self-regulatory organization, from 2\/2012 through 6\/2015, [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3752,3739,3787],"tags":[2510],"class_list":["post-6201","post","type-post","status-publish","format-standard","hentry","category-financial-firms","category-finra","category-morgan-stanley","tag-unit-investment-trusts"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Morgan Stanley to Pay $13M Over Improper Supervision of Unit Investment Trust Sales &#8212; Investor Lawyers Blog &#8212; September 25, 2017<\/title>\n<meta name=\"description\" content=\"FINRA is ordering Morgan Stanley Smith Barney LLC (MS) to pay about $9.8M in restitution to and a $3.25M fine for purportedly not properly supervising &#8212; September 25, 2017\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.investorlawyers.com\/blog\/morgan-stanley-pay-13m-improper-supervision-unit-investment-trust-sales\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Morgan Stanley to Pay $13M Over Improper Supervision of Unit Investment Trust Sales &#8212; Investor Lawyers Blog &#8212; September 25, 2017\" \/>\n<meta name=\"twitter:description\" content=\"FINRA is ordering Morgan Stanley Smith Barney LLC (MS) to pay about $9.8M in restitution to and a $3.25M fine for purportedly not properly supervising &#8212; September 25, 2017\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Shepherd Smith Edwards &amp; Kantas, LLP\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Morgan Stanley to Pay $13M Over Improper Supervision of Unit Investment Trust Sales &#8212; 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