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FINRA panel orders Morgan Stanley unit to pay $519,089 for clients' losses

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FINRA panel orders Morgan Stanley unit to pay $519,089 for clients' losses

A Financial Industry Regulatory Authority arbitration panel ordered Morgan Stanley Smith Barney LLC to pay $519,089 in compensatory damages to Stephen Balok and Brenda Balok for losses suffered in their investment accounts.

The Balok couple alleged losses in their eight accounts due to participation in an investment advisory program and from the purchase of junk bonds and exchange-traded funds that invested in derivatives, futures and options contracts. The couple alleged various charges such as deceptive trade practices, breach of contract and implied covenant of good faith and fair dealing, and breach of fiduciary duty.

The amount the Morgan Stanley unit will have to pay also includes an annual interest rate of 8.75% from April 5 up until the balance is paid in full.