{"id":897,"date":"2011-06-13T21:10:26","date_gmt":"2011-06-13T21:10:26","guid":{"rendered":"https:\/\/www.stockbrokerfraudblog.com\/2011\/06\/exmorgan_stanley_trader_to_set"},"modified":"2022-03-09T16:06:38","modified_gmt":"2022-03-09T22:06:38","slug":"exmorgan-stanley-trader-to-set","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/exmorgan-stanley-trader-to-set\/","title":{"rendered":"Ex-Morgan Stanley Trader to Settle SEC Unauthorized Swaps Trading Claims for $150,000"},"content":{"rendered":"

\t\t\t\tLarry Feinblum, an ex-Morgan Stanley & Co. Inc.<\/a> (MS) trader, has consented to settle for $150,000 SEC allegations that he hid from risk managers the true extent of risk involved in certain proprietary trading. This move caused the financial firm to suffer about $24.47 million in losses when it unwound the unauthorized positions. <\/p>\n

The SEC claims that over a 3-month period in 2009, Feinblum, who was a supervisor on Morgan Stanley’s Equity Financing Products Swaps Desk, and trader Jennifer Kim executed a number of transactions that set up net risk positions that were significantly over limits that “could be exceeded only with supervisory approval.” The two are also accused of submitting swap orders into the firm’s risk management system that they never planned on executing and which they then promptly canceled. <\/p>\n

The SEC says that not only did Feinblum and Kim set up their arbitrage trading strategy at positions that exceeded Morgan Stanley’s risk limits, but they also submitted the orders for the purpose of artificially and temporarily lowering the net risk positions in the securities as recorded in the firm’s risk management systems. They also went after a trading strategy that was supposed to create a profit from price discrepancies between foreign markets and US markets.<\/p>\n

On December 17, 2009, Feinblum, who had just lost $7 million the day before, admitted that he and Kim had gone beyond the risk limits on repeated occasions and that they hid their misconduct. Morgan Stanley then proceeded to unwind the positions but by then they had already taken the financial hit.<\/p>\n


\nRelated Web Resources: <\/strong>
\nFormer Morgan Stanley Trader Barred for Bogus Swaps<\/a>, Securities Technology Monitor, June 2, 2011
\nSEC: Morgan Stanley trader’s trick caused millions in losses<\/a>, The Washington Post, June 2, 2011
\nSEC Administrative Proceeding<\/a><\/p>\n


\nMore Blog Posts:<\/strong>
\nChina-Based Hackers Broke into Morgan Stanley Network, Reports Bloomberg<\/a>, Stockbroker Fraud Blog, February 28, 2011
\nMorgan Stanley Failed to Disclose Financial Adviser’s Felony Charge to FINRA<\/a>, Claims Car Accident Victim’s Attorney, Stockbroker Fraud Blog, January 10, 2011
\nMorgan Stanley & Co. and TD Ameritrade Inc. to Repurchase Over $338M in Auction Rate Securities from New Jersey Investors, Institutional Investor Securities Blog, May 4, 2011 Continue Reading \u203a<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Larry Feinblum, an ex-Morgan Stanley & Co. Inc. (MS) trader, has consented to settle for $150,000 SEC allegations that he hid from risk managers the true extent of risk involved in certain proprietary trading. This move caused the financial firm to suffer about $24.47 million in losses when it unwound the unauthorized positions. The SEC […]<\/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":[3752,3787,3993],"tags":[],"class_list":["post-897","post","type-post","status-publish","format-standard","hentry","category-financial-firms","category-morgan-stanley","category-swap-trades"],"yoast_head":"\nEx-Morgan Stanley Trader to Settle SEC Unauthorized Swaps Trading Claims for $150,000 — Investor Lawyers Blog — June 13, 2011<\/title>\n<meta name=\"description\" content=\"Larry Feinblum, an ex-Morgan Stanley & Co. 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