The bank never told investors about the extent of its Fed borrowings, even as they rose to the most in the 97-year history of emergency lending by the U.S. central bank...

At the peak of Morgan Stanley’s Fed borrowings, on Sept. 29, 2008, the firm reported that liquidity was “strong,” without mentioning how dependent its cash stores had become on the government lifeline...

...Neither Morgan Stanley nor its competitors in prime brokerage -- Goldman Sachs Group Inc. (GS), JPMorgan Chase & Co. (JPM), Citigroup and Credit Suisse Group AG -- disclose the size of their hedge-fund balances, leaving shareholders dependent on regulators who previously failed to rein in the risks.

That's a lot of cheddar.

I believe this is known as "the robust free exchange of information."

Comments

[Lex]

I believe it's known as securities fraud, although IANAL.