Boston, MA 08/27/2014 (wallstreetpr) – According to reports, Charles Schwab Corp (NYSE:SCHW) has lost an arbitration case worth $15 Million from Morgan Stanley (NYSE:MS). The matter came into light when SCHW accused MS of recruiting brokers improperly from its San Francisco branch. Those brokers later left with confidential information.
Two-Year-old Dispute Ends:
According to reports, an arbitration panel led by Financial Industry Regulatory Authority in San Francisco ended the two-year long dispute. Charles Schwab Corp (NYSE:SCHW) accused that MS organized an actionable raid in which it also tried to include the staff of SCHW.
The claims that were levied on Morgan Stanley (NYSE:MS) included a term called ” raiding” that played an important role in SCHW’s production. It is used when a firm loses 30%-40% of its production that is generated by brokers during a particular year from a branch office to another branch within a year’s time. One of the representatives of Charles Schwab Corp (NYSE:SCHW) said, “We don’t agree with the decision that panel has taken. We are looking after the legal options that we have got to file an appeal against it.”
The claims that were filed against Morgan Stanley (NYSE:MS) included instances of taking manufacturing evidence, proprietary information and operated a steady raid on clients and staff. It not only resulted in financial loss, but operational loss of SCHW as well. As soon as the comment from SCHW representative came in light, reporters tried to get in touch with anyone from MS. Although Morgan Stanley representative denied commenting on this issue as well as comment thrown by the SCHW representative. The only positive point in this issue for SCHW was but the arbitrators. They denied the claims of Charles Schwab Corp (NYSE:SCHW) but at the same time they asked Morgan Stanley (NYSE:MS) to pay $72,000 to SCHW in sanction. Although the panel of three members refused to reveal the reason behind this decision. No light was put on the brokers who left SCHW.
