Hosemann reaches $4.7M settlement with investment firm

Delbert Hosemann

JACKSON, Miss. (WJTV) — Secretary of State Delbert Hosemann has reached a $4.7 million settlement with an investment firm that has a branch office in Ridgeland.

Hosemann’s office said Morgan Stanley Smith Barney, LLC would have to return up to $4,243,815.28 to investors. The firm will also have to pay an administrative penalty of $100,000 to the State and will reimburse the Division’s investigative costs of $400,000.

“This is a significant settlement which is a culmination of hard work by the Division on behalf of investors,” says Secretary Hosemann. “It exemplifies the important investor protection role the Agency serves to safeguard our citizens through fair regulation and enforcement and hopefully deterrence.”

Many customers who had investment accounts with financial representatives at the Ridgeland branch who said they suffered inordinate losses.

The settlement concludes a multi-year investigation conducted by the Securities Division of the Office of the Secretary of State

Without admitting or denying the Division’s allegations, Morgan Stanley has agreed to resolve the investigation by establishing a customer fund of $4.2 Million Dollars, which will return a portion of the account losses to eligible customers who elect to participate.

The customer fund has been set up for the benefit of 259 accounts held by 213 investors from 15 states. In Mississippi, 194 accounts were affected.

Other states include Alabama (4), Arkansas (5), Arizona (2), California (2), Florida (5), Kentucky (2), Louisiana (25), Minnesota (1), North Carolina (4), Oklahoma (1), Pennsylvania (2), Tennessee (7), Texas (4) and Washington (1).

 

 

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