News & Products

Morgan Stanley DW Inc. has been fined $1.5 million by the Financial Industry Regulatory Authority (FINRA), and ordered to pay more than $4.6 million in restitution for “rule violations relating to the sale of corporate bonds to retail customers at excessive prices.” The action was investigated and settled by NASD’s Enforcement Department prior to the creation of FINRA, which consolidated the regulatory functions of the NASD and the New York Stock Exchange. Morgan Stanley was cited for charging excessive markups ranging from 5.88% to 17.86% on 2,807 sale transactions of Kemper Lumbermans Mutual Casualty Surplus Notes in the 9.15% and 8.30% series, with a face value totaling over $59 million. FINRA found that the firm failed to have a supervisory system in place that would have allowed Morgan Stanley to detect the excessive markups, and failed to properly register the individual responsible for review of the trading activities…

…Wells Fargo & Co.’s Wells Fargo Home Mortgage announced that it will close its nonprime wholesale lending business, which processes and funds subprime loans for third-party mortgage brokers. In 2006, the business represented 1.6% of Wells Fargo’s total residential mortgage loan volume of $397.6 billion…

…Wells Real Estate Investment Trust, the public, nontraded REIT with about $5 billion in assets across the country (mostly class A office buildings) has changed its name to Piedmont Office Realty Trust Inc. The REIT began operations in 1998 and was closed to new investors in 2003, but used external advisors until it became a self-managed office REIT in April by acquiring those external advisor companies…