New York, NY: (Jun-12-07) A class action lawsuit filed by brokerage clients against Morgan Stanley alleged that the financial firm told clients it was selling them precious metals that they would own in full. Morgan Stanley said it would store the metals, but made no investment specifically on behalf of those clients, or made entirely different investments of lesser value and security. The suit was filed by Selwyn Silberblatt in August 2005 on behalf of himself and others who bought precious metals, gold, silver, platinum, and palladium in bullion bar or coins, from Morgan Stanley DW Inc. and its predecessors and paid fees for their storage. The suit covered investors who did so between February 19, 1986 and January 10, 2007.
In a settlement reached, Morgan Stanley agreed to pay $4.4 million to settle the class action lawsuit. The company did not admit to any wrongdoing, but stated that the settlement was made to avoid the costs of protracted litigation. [REUTERS: PRECIOUS METALS FRAUD]
