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Ex-Morgan Stanley FA Seeking $3.5M Must Pay Wirehouse $500K

May 14, 2018

A former Morgan Stanley broker who sued the wirehouse for $3.5 million accusing it of wrongful termination will instead have to pay the firm around $500,000, the Florida Record writes.

Last month, Judge Robert Scola Jr. of the U.S. District Court for the Southern District of Florida confirmed a previous Finra arbitration ruling in a case between Charles Peter Wallace and Morgan Stanley, according to the publication.

Wallace was discharged from the firm in June 2013 over allegations that he’d made inaccurate statements about a client’s whereabouts to an annuity firm, according to his BrokerCheck profile.

The broker sued Morgan Stanley claiming defamation, wrongful termination, breach of fiduciary duty and cancellation of his promissory note, among other allegations, according to an arbitration award document from Finra’s Office of Dispute Resolution.

In September 2017, a Finra panel ruled in favor of Morgan Stanley, ordering Wallace to pay back the firm $550,000 on the promissory notes and declined Wallace’s request for expungement of his record, according to the award document.

Wallace took the arbitrators’ decision to court alleging the panel exceeded its authority, allowed inadmissible evidence, improperly overruled objections and in general looked at the case too broadly, according to the Florida Record. Last month, the court dismissed the allegations, the publication writes.

(iStock Photos)

Wallace has been in the financial services industry since 1992 and with Morgan Stanley from 2009 until his termination in 2013. He joined Oppeneirmer & Co. shortly after and remains registered with the firm. He has only one customer dispute, from January 2017, alleging excessive trading in a client account from July 2008 to July 2010. The dispute was denied, according to BrokerCheck.

By Alex Padalka
  • To read the Florida Record article cited in this story, click here.