US SEC closes inquiry into Morgan Stanley's cash sweep program with no enforcement action

From Yahoo Finance: 2025-05-06 12:15:00

The U.S. SEC has closed its investigation into Morgan Stanley’s cash sweep program for advisory accounts, with no enforcement action planned. The bank had been in discussions with the regulator since April last year. Cash sweeps allow clients to earn returns on uninvested cash balances, automatically moving idle cash to interest-bearing accounts or money market funds.

Several banks’ cash sweep programs were under scrutiny by the SEC, impacting their wealth management businesses. In January, Merrill Lynch and two Wells Fargo advisory firms agreed to pay a combined $60 million in civil penalties to settle SEC charges over compliance failures related to their cash sweep programs. The companies did not admit or deny the regulator’s findings.



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