(Bloomberg View) -- Morgan Stanley is in trouble in Massachusetts for allegedly running a sales contest for some of its financial advisers in which the advisers could win valuable prizes by convincing clients to borrow against their brokerage accounts.
Except that the prize money could only be spent on entertaining more clients: Rather than respond to the needs of their clients, financial advisers began to push PLAs in order to win the BDA incentives awarded under the sales contest. Financial advisors used the BDA money awarded to them to wine and dine clients, including the following items: Boston Celtics tickets, client drinks, one client meal in the amount of $653.40, and $1,000.00 in client gifts from one financial adviser.
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