Morgan Stanley Fined $2 Million Over Short-Sale Reporting

Morgan Stanley (MS) was fined $2 million by the Financial Industry Regulatory Authority over claims that the bank failed to completely report short positions in certain stocks.

Morgan Stanley didn’t accurately disclose billions of shares of short-interest positions over a period of more than six years, FINRA said Wednesday in a statement. The New York-based bank also had a deficient supervisory system that failed to detect the violations, the industry-financed regulator said.

Morgan Stanley included holdings from non broker-dealer affiliates in its aggregate reported positions, violating a Securities and Exchange Commission rule that governs short sales. Investors use such reports to track the level of short interest in a stock.