Finra dings Morgan Stanley $802,000 for overcharging clients

Finra dings Morgan Stanley $802,000 for overcharging clients
Morgan Stanley was penalized for failing to catch excess sales charges and fees from mutual fund transactions between 2015 to 2021.
DEC 23, 2022

The Financial Industry Regulatory Authority Inc. on Thursday penalized Morgan Stanley $802,000 for failing to catch excess sales charges and fees from mutual fund transactions between 2015 to 2021.

Morgan Stanley agreed to pay the restitution to more than 2,000 client accounts, or roughly $401 per account.

According to Finra, during that time, "Morgan Stanley’s supervisory system did not provide certain customers with mutual fund sales charge waivers and fee rebates to which they were entitled through rights of reinstatement offered by mutual fund companies."

Morgan Stanley agreed to the settlement without accepting or denying Finra's findings. There was no fine in the matter.

In the settlement, Finra credited Morgan Stanley for its cooperation.

"Morgan Stanley is pleased to resolve this matter," the company said in an email. "The firm has improved its systems and agreed to compensate impacted clients." 

Morgan Stanley in 2022 saw another strong year of nabbing client assets. In October the company reported it had brought in $65 billion worth of net new assets to its wealth management business during the third quarter, representing a 22% increase over the prior quarter and pushing total net new assets this year to $260 billion.

‘IN the Nasdaq’ with William Cohan, author of ‘Power Failure: The Rise and Fall of an American Icon'

Latest News

The 2025 InvestmentNews Awards Excellence Awardees revealed
The 2025 InvestmentNews Awards Excellence Awardees revealed

From outstanding individuals to innovative organizations, find out who made the final shortlist for top honors at the IN awards, now in its second year.

Top RIA Cresset warns of 'inevitable' recession amid tariff uncertainty
Top RIA Cresset warns of 'inevitable' recession amid tariff uncertainty

Cresset's Susie Cranston is expecting an economic recession, but says her $65 billion RIA sees "great opportunity" to keep investing in a down market.

Edward Jones joins the crowd to sell more alternative investments
Edward Jones joins the crowd to sell more alternative investments

“There’s a big pull to alternative investments right now because of volatility of the stock market,” Kevin Gannon, CEO of Robert A. Stanger & Co., said.

Record RIA M&A activity marks strong start to 2025
Record RIA M&A activity marks strong start to 2025

Sellers shift focus: It's not about succession anymore.

IB+ Data Hub offers strategic edge for U.S. wealth advisors and RIAs advising business clients
IB+ Data Hub offers strategic edge for U.S. wealth advisors and RIAs advising business clients

Platform being adopted by independent-minded advisors who see insurance as a core pillar of their business.

SPONSORED Compliance in real time: Technology's expanding role in RIA oversight

RIAs face rising regulatory pressure in 2025. Forward-looking firms are responding with embedded technology, not more paperwork.

SPONSORED Advisory firms confront crossroads amid historic wealth transfer

As inheritances are set to reshape client portfolios and next-gen heirs demand digital-first experiences, firms are retooling their wealth tech stacks and succession models in real time.