More e-mail trouble for Morgan Stanley.

• Author: Swartz, Nikki
• Position: UP FRONT: News, Trends & Analysis - Brief article

Morgan Stanley continues to pay for withholding e-mails that it claimed were lost during 9/11.

In late September 2007, the securities firm agreed to pay $12.5 million to settle charges that it lied to arbitration claimants and regulators, telling them on several occasions that e-mails they requested had been destroyed in the 9/11 terrorist attacks on New York's World Trade Center.

According to media sources, the settlement with the Financial Industry Regulatory Authority (FINRA, formerly NASD) included a $3 million fine. Morgan Stanley also agreed to establish a $9.5 million fund to pay several thou sand eligible arbitration claimants for failing to provide the e-mails and for failing to provide some claimants with updates to a supervisory manual during discovery. The securities firm did not admit wrongdoing.

In October, regulators fined Morgan Stanley another $7.5 million to settle separate, unrelated charges that over a five-year period (2000-2005) it provided customers with insufficient written trade confirmations for municipal...