Once upon a time, Ami Forte was a Morgan Stanley broker and managing director, ultimately becoming a member of the firm's "Chairman's Club," an honor reserved for "top wealth-management advisers." One of her clients, billionaire Roy Speer, got extra special treatment, in that he and Forte were doing the hippity dippity on the side. This was all well and good for many years, until Speer died and his wife decided she had something to say about the arrangement.
After Speer's death, his widow gained control of her husband's brokerage account and alleged that Morgan Stanley, through Forte, put through approximately 12,000 unauthorized trades in Mr. Speer's accounts, generating commissions of nearly $40 million. Lynnda Speer filed suit with the Financial Industry Regulatory Authority, saying Forte and Morgan Stanley "took advantage" of the elderly man, who died when he was 80. A three-person arbitration panel ruled in March that Morgan Stanley, Forte and a Morgan Stanley branch manager were guilty of elder exploitation, breach of fiduciary duty, constructive fraud, unauthorized trading and churning Roy Speer's accounts, along with negligence, negligent supervision and unjust enrichment. The panel awarded Lynnda Speer $32.8 million, plus costs and legal fees likely to be several million dollars more.
Can you guess where this is going?
Forte and another broker who worked with her were fired days later. She'd worked at Morgan Stanley for 16 years and, she said, her dismissal prevented her from receiving millions in deferred compensation and other benefits.
But if Morgan Stanley thought they could just fire her and move on, save for the images of a naked Speer it would prove difficult to get out of everyone's heads, Morgan Stanley thought wrong! According to the Forte, 1. Other people were handling her boy-toy's account at the time of the trades in question and 2. The whole damn office knew about their arrangement and no one said a thing.
She has filed a multi-million dollar securities arbitration case before FINRA against Morgan Stanley and its subsidiaries, saying the company unjustly fired and penalized her. She says the basis for the arbitrator's decision was Morgan Stanley's conduct after she was no longer managing the Speer investment accounts...According to documents filed by Forte's attorney, Speer had been estranged from his wife for years. Forte and Speer began a relationship about eight months after meeting in 1999, she said. "There were many, many people in Morgan Stanley who very much knew about that relationship for years and years and years," Forte said. Forte questions whether she would have been fired had she been a male broker.
Probably not, but perhaps if there was a similar situation wherein a widow embarrassed the bank with accusations of rubbing up against his deceased wife while executing unauthorized trades? Clearly these questions should be answered in the next edition of MS's employee handbook. As you were.