Morgan Stanley has agreed to pay $95 million to settle lawsuits over its sale of mortgage-backed securities during the run-up to the financial crisis
Morgan Stanley has agreed to pay $95 billion to settle claims that it misled investors about the quality of shoddy mortgage-backed securities during the run-up to the financial meltdown.
The deal settles years of litigation against the company, spearheaded by the Public Employees' Retirement System of Mississippi and the West Virginia Investment Management Board, according to a Reuters report. The suit claimed that Morgan Stanley violated securities laws in the selling of mortgage-backed securities in 2006 and 2007.
The case itself has dragged on since 2008, with plaintiffs being dealt several setbacks as various claims were dismissed by the presiding judge over issues of standing and timeliness, Reuters reported.
Morgan Stanley didn't admit any wrongdoing in the settlement. The decision to settle this case, along with others, moved the bank to increase its provisions for legal costs by $53 million last month.
