Labor & Employment Law

Morgan Stanley Executive sentenced in securities fraud and kickback scandal

By Dobin & Jenks

The FBI has announced that former key executive for Morgan Stanley, Darin Demizio, will serve 38 months imprisonment and three years of supervised release for conspiring to commit securities fraud and wire fraud and lying to the FBI. The trial took place in March before United States District Judge John Gleeson. United States Attorney for the Eastern District of New York, Benton J. Campbell announced the sentence.

Mr. Demizio routinely directed business from Morgan Stanley?s securities lending division to smaller brokerage firms for kickbacks that were paid to his father and Craig DeMizio, his brother. The amount of the kickbacks was over $1.6 million from 2000 ? 2004. His brother was sentenced to 21 months after pleading guilty to commit securities fraud and wire fraud.

Investors can be assured that the FBI is taking bribery and kickbacks seriously in the securities business. The Demizio conviction is the 29th conviction stemming from an ongoing industry-wide investigation.

Full post as published by The Law Planet Blog on July 30, 2009 (boomark / email).