SEC To Investigate Morgan Stanley and Goldman Sachs Over Block-Trading Practices

Posted on February 23rd, 2022 at 3:03 PM
SEC To Investigate Morgan Stanley and Goldman Sachs Over Block-Trading Practices

From the Desk of Jim Eccleston at Eccleston Law:

The Securities and Exchange Commission (SEC) has subpoenaed Morgan Stanley, Goldman Sachs, and several hedge funds in order to investigate the business of block trading.


The SEC intends to determine whether hedge funds may have improperly tipped clients ahead of large share sales, according to the Wall Street Journal. Sources familiar with the matter added that the SEC and other regulators have been monitoring block trades since as early as 2019. Some of the hedge funds that received subpoenas serve as “liquidity providers”, which typically facilitate the purchase of large quantities of stock or other securities when they lack interested buyers.


Block trading has become more prevalent in recent years as a record number of IPOs and secondaries have drastically increased liquidity. However, the issuance of subpoenas does not inevitably mean that the SEC will press charges because commentators suggest that the rules surrounding how hedge funds are permitted to inform their clients of impending block trades are somewhat ambiguous.


Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

 

 
 

Tags: eccleston, eccleston law, SEC

Return to Archive

TESTIMONIALS

Previous
Next

I cannot thank you enough for your guidance. It's a good feeling knowing someone is fighting for you.

Matt J.

LATEST NEWS AND ARTICLES

October 8, 2025
Northern Trust Sues Former Advisor for Alleged Fraud and Breach of Fiduciary Duty

According to ThinkAdvisor, Northern Trust Company has filed suit against former wealth management relationship advisor Christopher Walters, alleging that he engaged in “blatant fraud” and breached his fiduciary duty to both the firm and a longtime client.

 

October 7, 2025
Tricolor Bankruptcy Sparks DOJ Probe and Distress in Subprime Auto Loan Market

Tricolor Holdings, a subprime auto lender that combined used-car sales with high-interest financing for borrowers with limited or no credit history, has collapsed into bankruptcy amid a federal investigation into alleged fraud.

October 6, 2025
Judge Allows Widow's $8 Million FINRA Arbitration Claim Against JPMorgan to Proceed

JPMorgan Chase & Co. failed in its effort to block an 85-year-old widow from pursuing claims in FINRA arbitration over allegations that the bank failed to prevent her son from siphoning more than $8 million from her accounts.