State official subpoenas Morgan Stanley over Facebook IPO
A state official issued a subpoena to an investment bank in an effort to investigate its handling of Facebook’s initial public offering last week.
Secretary of the Commonwealth William Galvin said yesterday that he issued a subpoena to Morgan Stanley.
“His office’s Securities Division … issued a subpoena to Morgan Stanley in connection with the discussions by their analyst with certain institutional investors about the revenue prospects for Facebook prior to that company’s initial public offering last week,” Galvin’s office said in a statement.
At issue is whether Morgan Stanley told only select clients about an analyst’s report that cut Facebook’s revenue estimate for the year, according to Reuters.
It’s the latest bad news since Facebook went public Friday. It’s stock dropped about $7 from its initial offering of $38 just days ago.
A lawsuit by investors against Facebook CEO Mark Zuckerberg, Morgan Stanley and other banks was also reported today.