Morgan Stanley shareholders have been riding a nice littlle wave in the Wall Street firm’s stock price. But yesterday’s drama at hedge fund Pequot Capital, where Morgan boss John Mack worked a few years back, is likely to add a little agita to their day.
Morgan has battled back relatively well after the meltdown and shored up its brokerage unit enough that its shares have popped 50% in the past three months. Now, an old insider trading investigation may sneak up on Mack the Knife.
Remember when the Securities and Exchange Commission began its probe of Samberg, an agency investigator, Gary Aguirre, was fired for displaying “erratic” behaviour. He then turned whistleblower to claim other government officials tried to slow down his bid to interview Mack, who was then the chairman of Pequot but moving toward taking the reins of Morgan Stanley.
Before being kicked to the curb, Aguirre was trying to determine whether Mack—who already had been bounced from Morgan in a power struggle once, then dumped by CS First Boston in a dispute with his European masters—has tipped off Samberg about a merger. SEC officials said then they never called Mack in to testify because they didn’t have enough evidence.
Mack may again steer clear of serious problems in the ongoing Pequot drama–and there hasn’t been any mention of him being dragged back in yet–but the last thing he and his Morgan stakeholders need is a distracted CEO.
Business Insider Emails & Alerts
Site highlights each day to your inbox.