SEC Announces Settlement of Another Misleading Trade Case – Bonacci

Shortly after the Chin case was settled, the SEC settled a similar case with Nicholas Bonacci on September 26, 2016.  Here is the link to their decision.  Like Chin, Bonacci was a trader in 2012 in generally illiquid residential mortgage-backed securities, in this case at Morgan Stanley & Co (“Morgan Stanley”).  “Many” of the customers managed funds which owed fiduciary duties to their own clients.  Bonacci was placed on administrative leave by the firm in March 2014.  Bonacci is accused of misleading customers on five identified occasions about whether the sale involved a seller or was out of Morgan Stanley’s own book, the amount he was earning on the trade and the price paid, or to be paid, on the other side of the trade.  Bonacci has been fined $100,000, and suspended from the industry for one year, taking into account his cooperation.