FINRA Fines and Suspends Ex-Morgan Stanley Adviser for Unapproved Discretionary Trades

The Financial Industry Regulatory Authority fined and suspended Arun K. Aggarwal after he placed trades in a customer’s account without written approval.

FINRA says between June 2021 and September 2022, Aggarwal exercised discretionary authority when placing 163 trades in a customer’s account. Although the customer understood that Aggarwal was placing trades in the account, the customer had not provided prior written authorization for Aggarwal to exercise discretion. In addition, Morgan Stanley did not accept the account as discretionary.

Aggarwal consented to the imposition of a two-month suspension from associating with any FINRA member in all capacities and a $7,500 fine.

Aggarwal first registered with FINRA as a general securities representative in 1987 and was affiliated with four firms prior. Aggarwal registered with FINRA as a GS through Morgan Stanley in June 2009.

On Oct. 18, 2022, Morgan Stanley filed a uniform termination notice, stating that it “[d]ischarged” Aggarwal for “unauthorized discretion in a client’s account and response to investigation related thereto.”

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