You're watching...
FBN's Charlie Gasparino on Morgan Stanley President Greg Fleming meeting with brokers over faulty technology.
Also in this playlist...
Auto-advance: ON
Auto-advance
This transcript is automatically generated
-- Heidi thank you so much so will -- technology up and Morgan Stanley CEO James Gorman is planned to become the largest most successful brokerage business in the world.
But Charlie Gasparino has all the details on this story come this is becoming a very acute problem.
Inside Morgan Stanley there is a problem with technology.
I'll brokers are threatening haven't been left it up but they are threatening in -- to leave the firm.
And here's what we know there is it may be upgraded their technologies is for the brokerage system this is so you're.
Mr.
or mrs.
Jones you go to Morgan Stanley you wanna buy a stocky and go and -- -- fill out paperwork glitch in the computer apparently this new.
Technology system that was allowed to do much more than buy stocks -- -- also a system by -- whatever doesn't work it does or -- a fan defected to the point where.
Forget about buying -- stock.
You can even get registered at some points this is an acute problem inside mortgage -- So what's going on now Greg Fleming -- ahead of the wealth management division is a four week with with the fox does network -- -- has launched a seven city tour just finished up last week.
Miami.
LA Dallas.
Boston New York obviously.
Atlanta.
San Francisco husky ESM Cisco.
And basically trying to prevent a sort of massive defection we do know as of right now.
There has not been a massive defection they are not losing assets.
In droves they are not losing brokers.
But the potential for that to happen is is is huge at mortgage -- and here's a thing if you own Morgan Stanley stock and you follow this company.
This is one of the biggest Wall Street firms they made -- gamble on the James Gorman.
They bet the ranch on brokerage they are transforming his firm for what used to be you know a risk taking firm that the investment banking on the side the one that's more about.
Dispensing advice to small investors the Morgan Stanley has the biggest brokerage firm that since they did that deal.
Which Smith Barney at that combines this with money brokers from Citigroup during the height of the financial crisis.
-- -- of 171000.
Brokers.
This is the biggest brokers stood firm in the country and you can't set up new customers.
You got a real problem so this is just yet another headache the James Gorman faces and it's a pretty big one right now when -- stand because.
If you can't sign people up I mean this is the basic stuff this system can't do you got real problems but I they said they have a lost.
Brokers yet they have a wants assets yet at least that's what -- tell me and they said this will be borne out in the quarterly results.
So my question is -- -- -- Morgan Stanley broker -- -- the cream of the crop where would you go if you did leave.
We should point out a -- and that's a good question because a lot of times.
They would would Morgan says -- do you wanna go to Merrill.
Actually Merrill would consider themselves the critical.
Which you wanna go to UBS I mean listen nothing's great almost you're right now but don't people pay retention packages -- pay upfront fees.
Bonuses due to -- brokers to go from when shop to another.
There are other places to go.
Yes.
Isn't more assembly is run by good people James Gorman is it is -- Smart is a Smart guy he's you know he worked at Merrill Lynch you -- -- brokers department at Merrill Lynch.
He was outside consultants of Maryland for the brokers department uses guy in the stands.
-- the business of trying to sell.
Stocks bonds or whatever to small -- try to become suitable wealth management.
UBS used to run Merrill Lynch's department you can work.
Four for Bank of America which owns Merrill Lynch now and the people they're -- -- the guy's name that runs it but.
Fairly fairly significant player in India in the into into wealth management business and -- from what I understand is one of the top guys it.
It goes on it -- other places to work but you know.
Is that this is a real problem I think for for James Gorman -- he doesn't get his hands around it now I mean.
First off it's that easy just to pick up in leads to another firm you know -- -- you got you're get you get some of infrastructure could is that there.
The problem is if you can't sign people up.
Real problems if you can't bring in new investors in this environment when you have a firm dedicated.
To this part of the business -- -- -- he's doing.
-- and by the way.
Think it's gonna cost more to upgrade it.
I think is -- huge -- means obviously developing story we're gonna we're gonna keep on -- gas free.
