From the report:
Read the Full StoryThree former Morgan Stanley brokers on Tuesday sued the federal government and Department of Labor officials alleging that the agency erred and exceeded its regulatory authority with a September advisory opinion that bolstered the wirehouse’s legal defense against a rash of deferred compensation claims.
The DOL had found that Morgan Stanley’s pension and retirement plan rules do not apply to its deferred compensation program for financial advisors, which undercut a key argument that the brokers have made in arbitration claims seeking to recoup millions in backpay. They have said the plan is governed by the Employee Retirement Income Security Act of 1974, which would make it illegal for the firm to withhold payments when they move to a rival.