FINRA fined Morgan Stanley Smith Barney $1.5 million for technical failures, including a faulty website link that obstructed client’s from viewing fund prospectuses.
For a number of years before 2013, Morgan Stanley made mandated fund prospectuses available to customers online. However, as the FINRA settlement states, in November 2013, Morgan Stanley updated its systems but failed to make sure a working website link was in place for clients who wanted to see particular fund prospectuses.
In August 2014, a client looking to see an online prospectus contacted Morgan Stanley, which alerted the firm that the link was not available, said the settlement. For nine months, Morgan Stanley failed to deliver nearly 2.1 million prospectuses to online clients through its “view prospectus” link.
Between November 2013 and December 2014, due to a coding error, Morgan Stanley also failed to generate and send around 23,500 investment objective change letters to clients, the regulator stated. According to industry rules, broker-dealers are required to confirm in writing to customers any changes made to a client’s investment objectives within 30 days of such a change.
Additionally, between June 2012 and June 2016, the firm failed to send at least 4,000 letters to customers confirming changes in their investment objectives within 30 days of the change.If you or someone you know has lost money as a result of an investment or Ponzi scheme, please contact Richard Frankowski at 888-741-7503 to discuss your potential legal remedies or complete the contact form.