Categories

Do I have to stop my personal trading account if my wife accepts a banking job at Morgan Stanley?

The rules come from the Securities and Exchange Commission (SEC) and are fairly common for people in your situation.

Your personal trading will be forbidden if your spouse works in banks. All trades will be held for 30 days, no shorting will be allowed, and all stock trades will be subject to preclearance. You’ll also be restricted to trading with licensed brokers who will share all trade data with the bank, and you’ll have to declare all accounts.

Employees, spouses, domestic partners, dependents, and anybody else who receives a significant amount of money from any of the aforementioned are all subject to the employee trading and investment policy. You’ll need to move your assets to a brokerage account as well.

I suggest you speak with your HR and/or Compliance teams. Depending on the size of the company, they’ll have an employee trading policy in place that will quickly clear things up.

There are no valid methods for preventing the disclosure of information. They take this extremely seriously, and if they find out about an account you didn’t report or a single transaction you didn’t pre-clear, you’re likely to face harsh repercussions. You have no idea what they know, either.

Conflicts of interest are a problem for investment banks, and personal trading is governed by a number of rules.

Almost no investment bank permits its personnel to trade in the securities of the companies they advise, or even in the sectors they cover, in certain circumstances. It may be a violation of their fiduciary obligations, it creates conflicts of interest, and it just looks bad.

Leave a Reply

Your email address will not be published. Required fields are marked *