Regulators Investigate Morgan Stanley's Wealth Arm

Morgan Stanley's stock plunged after reports of federal probes into its wealth arm's client-vetting practices and potential money laundering risks. Regulators including the SEC, the Office of the Comptroller of the Currency, and the Treasury Department are investigating whether the bank properly vetted potential clients and monitored their financial activity, particularly with international clients. Despite investing in compliance and technology, the bank faces potential supervisory action from the Federal Reserve.