Equity block trading has come under intense scrutiny this year, after Morgan Stanley paid $250 million in January to settle charges relating to a former head of US equity syndicate. He had leaked confidential information on forthcoming block sales to potential hedge fund buyers, who then drove down the price against the sellers by going short, knowing they could cover their positions through the coming block on favourable terms.
But it had long been known that the investigation was progressing, and the outcome hasn’t damaged the business.
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