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Massachusetts Fines Morgan Stanley $5M Over Facebook IPO

By: Associated Press
By: Associated Press

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Monday, December 17, 2012

Massachusetts officials say they are fining investment bank Morgan Stanley $5 million for disclosing a revenue shortfall with analysts and institutional investors but not the general public ahead of Facebook's troubled IPO in May.

Facebook filed amended documents on May 9 with securities authorities, but Morgan Stanley organized phone calls with analysts to relay revenue figures that the amendments didn't include. Those numbers were lower than what many analysts had expected.

Massachusetts' Secretary of the Commonwealth, William Galvin, announced the fine Monday. In a press release, Galvin said Morgan Stanley's "improper influence" was "yet another example of an unlevel playing field, where Main Street investors were put at a significant disadvantage to Wall Street."

Morgan Stanley isn't admitting guilt but agreed to be censured and pay the fine.


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