Morgan Stanley Fined $15 Million by SEC Over Adviser Theft

Morgan Stanley will pay $15 million to settle claims that its Smith Barney unit failed to prevent four former employees from stealing millions of dollars from customer funds, the US Securities and Exchange Commission said Monday.

The broker dealer’s inadequate policies failed to detect hundreds of unauthorized transfers between May 2015 and July 2022 from its customers’ or clients’ accounts, according to the regulator.

The firm, an arm of New York-based Morgan Stanley, settled the allegations without admitting to or denying them. It agreed to hire a compliance consultant to review recent internal changes to prevent fraud.

The firm ...