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Securities Arbitration Panel Rules Against Broker

Friday, September, 9, 2011

Securities arbitration frequently concerns claims that investors bring against brokerage firms, alleging misuse of funds or inappropriate investment advice.  In the case of William Andrew Griffin, however, the dispute involved a broker and his own brokerage firm.


Securities Arbitration Case Alleged False Promises


It is reported that Griffin was a broker who worked with Morgan Stanley Smith Barney for slightly over a year.  He had received approx $463,000 bonus from the firm.  Morgan Stanley later requested that the bonus money be returned.  Griffin refused, claiming that the firm made promises to him before he joined – promises that were never fulfilled, including the offer of a new office in Gainesville, Georgia.  According to Griffin's representatives, these promises were "knowingly false or at least negligent."


Morgan Stanley filed an arbitration case against Griffin in 2010; Griffin's complaints about breach of promise were then issued in a counterclaim. 


The arbitration attorneys deciding the case did not agree that Griffin's counterclaims held merit, issuing a statement that “We see in this record a business deal that did not work for either party, with the usual frustrations and frictions, but no convincing evidence of intentional or negligent misleading statements or broken commitments." The arbitration panel also took issue with Griffin's monetary calculations about the amount of lost business he suffered as a result of Morgan Stanley's actions.


In the end, Griffin was ordered to pay back the full amount of the bonus plus interest.