The SEC May Investigate Whether Morgan Stanley Gave Material News About Facebook Just Before The IPO

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Photo: By Justin Sullivan/Getty Images

It gets worse for Facebook’s public debut.The SEC and FINRA are now going to investigate what really happened with Facebook’s IPO, Reuters reports.

The stock is trading down on the news. It’s down seven per cent today, and fell after this news broke.

FINRA chairman Richard Ketchum is looking at whether or not Morgan Stanley and Facebook shared negative news with institutional clients without telling the public at large.

SEC Chair Mary Shapiro made this vague statement: “I think there is a lot of reason to have confidence in our markets and in the integrity of how they operate, but there are issues that we need to look at specifically with respect to Facebook.”

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