Morgan Stanley may pay up to $1 billion to resolve US probe into private stock sales – Semafor

(Reuters) -Morgan Stanley may pay between $500 million and $1 billion to resolve a long-running U.S. probe into how it handled private stock sales, Semafor reported on Tuesday, citing people familiar with the matter.

A possible settlement with the Justice Department and the U.S. Securities and Exchange Commission (SEC) may also see the bank tighten its internal controls, the report said.

The Wall Street giant, however, likely will not plead guilty to a crime, the report added.

Morgan Stanley declined to comment.

The bank said earlier this year that it was cooperating with U.S. regulators over investigations into its block-trading practices and providing authorities with information.

It had also at the time talked about facing civil claims from market participants who said they were harmed by the company’s practices.

Block trades are single orders for large trades, typically placed by institutional investors, which their broker-dealer drips into the market over time so as not to move the price.

The SEC investigators have been probing such practices since at least 2019, Reuters had previously reported.