Morgan Stanley bankers hope new CEO Ted Pick ends fines in brutal texting clampdown

Morgan Stanley CEO James Gorman has slightly more than two weeks left in his nearly 14-year tenure at the helm of the Wall Street giant — and many of the rank and file are counting the days.

That’s because junior bankers are hoping to catch a break after weathering more than a year of harrowing interrogations and punishing fines stemming from a clampdown by the Securities and Exchange Commission for doing business on messaging apps in breach of record-keeping rules.

Out of $2 billion levied by the SEC across nearly a dozen US banks, Morgan Stanley was slapped with a $125 million fine in September 2022 — and Gorman took unusual measures to take it out of the hide of employees rather than investors, sources said.

Insiders at Morgan Stanley describe a “witch-hunt” atmosphere si🌌nce early 2022 when the probe was first announced.

Hundreds♔ of ꩲbankers were interrogated in lawyers’ offices about whether they’ve used personal devices to text their colleagues and bosses, according to sources.

“When🐼 we got an email saying ‘legal wants to talk’ we thought it would be training not punishment,” a Morgan Stꩲanley source griped. 

Fines ranged fr𝕴om a few thousaꦺnd dollars to as much as $1 million.

Many complained they wereꦑ fined without being given adequate training or warnings, and that offenses in some instances seemed trifl♍ing.

Some claim they got dinged for answering ♏the phone when their boss called or r🎀esponded to benign messages about work happy hours.

By comparison, Goldman also paid $125 million and JPMorgan wඣas fined $200 mill꧋ion.

But those banks weren’t as aggressive about nic🐻keling and diming individual employees, sources said.

Those who were ousted had either knowingly vi꧅olated policies or when asked hadn’t been 🔯honest. 

“It▨ was more about the cover up,” one source said. 

Goldman fired a former 𒊎global head of transactioꦆn banking over WhatsApp misuse.

JPMorgan fired Edward Koo — who’d been at the firm two decades —🌜 for reportedly starting a WhatsApp chat devoted to “market chatter.”🙈

Other members of the group were♑ s♐lapped with a fine but kept their jobs.

One former banker at Jefferies was fined nearly $50,000 and then resigned after br🌠agging in a text message that a deal he was working on would pay off his mortgage.

At Morgan Stanley, terrified bankers are hoping the air will clear on Jan. 1, when Ted Pick — a veteran trader who is “loved by the foot soldiers,” according to a source — takes the reins from Gorman as the bank’s new CEO. 

“Culture and loyalty are important to him,” the source said of Pick, adding that many are specifically hopi♕ng that will 🌠mean an end to the texting clampdown.

Of course, some sources close to the bank caution there has been no official change to policy when it comes♑ to collecting fines.

Sources sa⭕y that Gorman has been on edge since the bank lost nearly $1 billion after family office Archegos melted down in 2021.

The loss has pushed Gorman to believe in stricter protocols, sources said⛎.

was “the worst loss in my tenure in over a decade that we’ve had,” Gorman said. “There were warni🍷ng signs and you know this was a miss on our part.”

Still, some insiders say the time may be ripe for a lig🃏hter touch at Morgan Stanley when it comes to dealing with the talent. 

“The easiest course of ac♓tion for managers is to make things as restrictive as possible,” a source told On The Money. “Of course, that’🏅s not the smartest approach to make employees happy.”