Morgan Stanley was charged with "dishonest and unethical conduct" by Massachusetts' top securities regular on Monday for having pushed its brokers to sell loans to their clients.

Secretary of the Commonwealth William Galvin alleges that the bank ran high-pressured sales contests in Massachusetts and Rhode Island where brokers could earn thousands of dollars for selling so-called "securities based loans." (SBLs)

The contests, designed to boost business, were officially prohibited by Morgan Stanley but turned out to be lucrative for the bank with the pace of loan origination tripling and adding $24 million in new loan balances, Galvin said.

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