Morgan Stanley Accused Of Pulling A Wells Fargo

So that's not good!
Getty Images

Getty Images

Remember the sh*t-storm Wells Fargo recently found itself in? You should, because it just happened last month, and it's an ongoing storm ' sh*t. And now Morgan Stanley is getting a little taste.

A Morgan Stanley unit was accused by Massachusetts officials of forcing its financial advisers into high-pressure sales contests to cross-sell products to clients. The accusation on Monday against Morgan Stanley Smith Barney LLC, the New York-based bank’s retail brokerage, increases the scrutiny on an industry tactic that has recently backfired for others including Wells Fargo & Co., which agreed last month to pay $185 million after federal and local authorities found the firm’s cross-selling culture helped push employees to open unauthorized accounts...The high-pressure sales culture attracted scrutiny after authorities blamed San Francisco-based Wells Fargo’s cross-selling goals for encouraging employees to potentially open more than 2 million accounts without customers’ knowledge. Wells Fargo Chief Executive Officer John Stumpf was summoned to Washington for two Congressional hearings to explain the practices. Jim Wiggins, a Morgan Stanley spokesman, said the company objects to the allegations and intends to defend itself “vigorously.”

Morgan Stanley Unit Accused of High-Pressure Sales Tactics [Bloomberg]


Layoffs Watch '12? Morgan Stanley?

James Gorman is approaching cost-cutting with the same focus as the Zodiac killer, so maybe. Morgan Stanley is "maniacally focused" on cutting costs apart from compensation and is on track to reduce expenses by $500 million this year, Chief Executive James Gorman said on Tuesday. Gorman, speaking at a conference in New York, also reiterated Morgan Stanley's plans to reduce costs by $1.4 billion annually over the long term...The bank is also monitoring the size of its overall payroll for possible job cuts as revenue remains under pressure from a weak market environment, he said. "We are very, very focused on that, obviously, in this environment," said Gorman. Morgan Stanley "maniacally" focused on cost cuts-CEO [Reuters] Very much related: Morgan Stanley Joins Goldman Sachs In Herbicide

Layoffs Watch '12: Morgan Stanley

The House of Gorman is said to be in the process of letting some employees down easy. Morgan Stanley will this week complete a round of job cuts that will ultimately lead to the company shedding 100 sales and trading staff, underscoring what is expected to prove a dismal second quarter for Wall Street banks. The cuts are across Europe, the Middle East and Asia, according to people familiar with the New York-based bank’s plans. The bank has so far laid off about two-thirds of its original 100-person target, leaving some 33 people to go this week. Morgan Stanle Said To Shed Staff As Deals Fall [FT]

Layoffs Watch '12: Morgan Stanley

The House of Gorman will be saying good-bye to a few thousand Little Jims before year-end. Chairman and Chief Executive James Gorman said the firm's work force at year-end will fall 7% from 2011, reflecting previously announced layoffs as well as the firm's efforts in applying "a high bar for replacing attrition." The forecast implies a reduction of more than 4,000 jobs from the firm's global headcount of 61,899 at Dec. 31. Last winter, Morgan Stanley announced 1,600 job cuts spread across its businesses, which was its largest such cutback since late 2008 and early 2009. The firm completed roughly 4% to 5% of those cuts in January and will complete an additional 2% to 3% by the end of 2012, a spokeswoman said. Morgan Stanley Expects 7& Cut In Its Workforce [WSJ]