Morgan Stanley and Broker Anna Khai
A FINRA arbitration panel awarded $825,000 to two Morgan Stanley Smith Barney, LLC clients after the panel found that Morgan Stanley’s “hiring process was not sufficient to vet the financial advisor who was the cause of the losses incurred by the Claimants.”
The broker, Anna Khai (aka Anna Khatchatrian), borrowed money from her clients and solicited Morgan Stanley customers to invest in non-approved investments and used the firm’s equipment and premises to conduct these transactions. The $825,000 award is a combination of $660,000 in compensatory damages and an additional $165,000 in punitive damages plus interest.
FINRA rules require brokerage firms to investigate the character, business reputation, qualification and job experience prior to hiring a broker – essentially, a firm has an obligation to perform due diligence before making a hiring decision.
Because the firm failed to meet its obligation before hiring Ms. Khai, it was held responsible for the broker’s actions.
Call a Los Angeles Securities Fraud Attorney Today
If you invested with Anna Khai, you may have certain legal rights that require your immediate attention. Contact an for a experienced Los Angeles securities fraud attorney consultation today.