Multiple regulators, including the U.S. Securities and Exchange Commission and the Office of the Comptroller of the Currency, are investigating Morgan Stanley’s wealth management arm to assess if the bank has appropriately analyzed the identities of prospective clients and the sources of their wealth, as well as how it monitors their financial activity.
The wealth management arm serves high net-worth clients, along with providing brokerage, investment advisory, custody and financial planning services to small- to medium-sized businesses. This sector has aided Morgan Stanley widen its market capitalization beyond rival Goldman Sachs.
A years-long civil and criminal probe into Morgan Stanley’s handling of large stock trades for clients ended earlier this year with the company agreeing to pay $249.4 million. It also allowed the bank to enter a three-year non-prosecution agreement that lets it avoid criminal charges.
