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For the most part, it’s great to be on an equity syndicate desk chief’s Rolodex, especially if that chief is running the block trades at Morgan Stanley. Sure, you have to buy the occasional slug of garbage to stay on his good side, but just look at what you get in return: favorable allocations in hotly-sought-after IPOs, good deals on big blocks of stock you want, and, of course, a sense of what’s coming on the market in advance of its actually doing so, permitting perhaps the odd lucrative short sale even on deals you don’t participate in.

It's less great to be on said equity syndicate desk chief’s Rolodex, however, when the powers that be decide that block trading may be insider-trading, and that Rolodex gets subpoenaed and the conversations flowing from it get picked over by prosecutors and the Securities and Exchange Commission.

The list of people whose communications are being sought ranges from executives at prominent Wall Street hedge funds, such as Andrew Liebeskind at Citadel’s Surveyor Capital and Jon Dorfman at Element Capital Management, to money managers at smaller firms focusing on block trades, including executives at CaaS Capital Management and Islet Management, and a former employee at Segantii Capital Management, the people said.

Bankers include Felipe Portillo, a risk executive within Credit Suisse Group AG’s equity capital markets group, Michael Daum, a partner at Goldman Sachs Group Inc., and Michael Lewis, the head of U.S. equities cash trading at Barclays Plc, the people said…. Authorities have been going over recordings of [Morgan Stanley equity syndicate desk head Pawan Passi’s] phone calls, Bloomberg reported earlier this week. They’re also scrutinizing communications involving at least three of his colleagues at Morgan Stanley: Evan Damast, its global head of equity and fixed-income syndicate, John Paci, a senior equities trading executive, and Charles Leisure on the syndicate desk.

Morgan Stanley Relationships on Wall Street Snared in Probe [Bloomberg]

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