SEC's IPO probe expands to Morgan Stanley-WSJ
Reuters, 02.26.03, 6:49 AM ET
NEW YORK, Feb 26 (Reuters) - The Securities and Exchange Commission, expanding a probe into alleged IPO abuses, has signaled it may file civil charges against Morgan Stanley (nyse: MWD - news - people), the Wall Street Journal reported on Wednesday.
Citing people familiar with the matter, the newspaper said the SEC may file charges alleging the securities firm doled out shares to investors based partly on their commitments to buy additional stock after trading began.
The SEC staff has informally indicated to Morgan Stanley that it plans to send a Wells notice notifying the firm of the planned charges, the people told the Journal.
In the inquiry, enforcement staffers have asked about Morgan Stanley-led IPOs including those of Avanex Corp. (nasdaq: AVNX - news - people), Avici Systems Inc. (nasdaq: AVNX - news - people) and Transmeta Corp. (nasdaq: AVNX - news - people), people familiar with the matter told the newspaper.
Morgan Stanley has denied wrongdoing to the regulators, one person familiar with the talks told the Journal.
Morgan Stanley was not immediately available for comment early on Wednesday morning.
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