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Morgan Stanley Unit Accused of High-Pressure Sales Tactics

  • State says advisers pushed into contests to cross-sell loans
  • Massachusetts official accuses company of ‘unethical conduct’
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A Morgan Stanley unit allegedly set up a high-pressure contest to spur financial advisers to cross-sell loans backed by investment accounts in an effort to boost banking and lending business and gain ground on rivals, the Massachusetts securities regulator said in a complaint against the company.

The accusation against Morgan Stanley Smith Barney LLC, the New York-based bank’s retail brokerage, increases the scrutiny on an industry tactic that has recently backfired for others including Wells Fargo & Co. The San Francisco-based bank agreed last month to pay $185 million after federal and local authorities found its cross-selling culture helped push employees to open unauthorized accounts.