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Morgan Stanley to pay $275 mln penalty for misleading RMBS investors
July 24, 2014 / 3:27 PM / 3 years ago

Morgan Stanley to pay $275 mln penalty for misleading RMBS investors

WASHINGTON, July 24 (Reuters) - The U.S. Securities and Exchange Commission said on Thursday it had charged Morgan Stanley with misleading investors about two mortgage-backed securities it issued before the 2008 financial crisis, and that the bank would pay $275 million to settle the case, according to a press release.

The SEC found Morgan Stanley had not given investors in the securities, which were called Morgan Stanley ABS Capital I Inc. Trust 2007-NC4 and Morgan Capital I Inc. Trust 2007-HE7, the correct information about how many of the mortgages they contained were delinquent, the release said.

A lawyer for Morgan Stanley did not immediately respond to a request for comment. (Reporting by Sarah N. Lynch; Editing by James Dalgleish)

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