"Morgan Stanley Settles Block Trading Probes with $249 Million Payment"
Morgan Stanley has agreed to pay $249 million to settle a criminal investigation and a related Securities and Exchange Commission probe regarding the unauthorized disclosure of block trades to investors by the bank's employees. The settlement includes a non-prosecution agreement with the U.S. Attorney's Office and an admission of responsibility by the bank. The SEC charged Morgan Stanley with failing to enforce policies related to the misuse of material non-public information. Former equities executive Pawan Passi, involved in the misconduct, has entered into a deferred prosecution agreement and must pay a civil penalty. The bank stated that it has made enhancements to its controls around block trading, while Passi's lawyer expressed relief that criminal conviction was not pursued.