Morgan Stanley Fined $382,500 For Failure to Supervise Former Broker Justin Amaral

Morgan Stanley is facing sanctions for failing to monitor a former broker’s trading activity.

The Sonn Law Group is investigating allegations that Justin Amaral committed misconduct. Under FINRA Rules, brokerage firms are liable for their brokers’ misconduct or negligence and investors may be able to their investment through FINRA arbitration. Contact Sonn Law Group today or call us at 866–827–3202 for a free consultation.

Justin Amaral (CRD#:4440980) ended his employment with Morgan Stanley in 2014 after allegations that he was acting as an executor and beneficiary in a client’s estate. Amaral was subsequently barred by FINRA in 2015 for failing to appear for on-the-record testimony.

More recently, Morgan Stanley consented to findings that complex managers, compliance personnel, and other superiors of Justin Amaral “closed out” most alerts of excessive trading in his clients’ accounts after he stated the alerts reflected poor markets and account rebalancing.

Morgan Stanley agreed to pay a $200,000 sanction and $182,500 in restitution to four clients in Massachusetts for their failure to monitor Amaral’s trading activity. Morgan Stanley employees allegedly closed 97 alerts generated by Amaral’s activity over a four and a quarter year period, starting in January 2010.

Morgan Stanley did not open an investigation into Amaral’s activities until he was named in a customer complaint in April 2014. Since then, Morgan Stanley has been settling complaints of excessive trading from individual clients on a case-by-case basis. It has paid $382,000 to settle three claims that cumulatively sought $929,000, according to Amaral’s BrokerCheck report.

Jeffrey R. Sonn is an experienced investor losses attorney. If you suffered losses because a financial professional committed acts in violation of FINRA Rules, Mr. Sonn will protect your rights and interests. Please do not hesitate to contact the Sonn Law Group today for a free review of your claim.