Recordings of Morgan Stanley’s Passi Examined in U.S. Probe
- Investigation is scrutinizing how firms execute block trades
- Feds also are poring over bankers’ communications with clients
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U.S. authorities conducting a criminal probe into how Morgan Stanley executives handle block trades are examining recordings of phone calls between the bank and outside fund managers, according to people with knowledge of the inquiry.
The recordings involve conversations between Pawan Passi, one of Morgan Stanley’s top equities executives in block trades, and investing clients, the people said, asking not to be identified discussing the confidential investigation. The use of such invasive information-gathering underscores how a civil inquiry opened by the Securities and Exchange Commission in 2018 has escalated, with the Justice Department launching an inquiry too.