Goldman Sachs Group Inc. and Morgan Stanley tentatively have agreed to pay $40 million apiece in a proposed settlement over initial public offering practices employed during the late 1990s stock market boom, The Wall Street Journal said on Tuesday.
Goldman Sachs has agreed to the language of a tentative pact with the U.S. Securities and Exchange Commission, while Morgan Stanley's pact has not progressed that far, the newspaper said, citing unspecified people familiar with the matter.
A formal announcement of the civil charges could be weeks or months away, the newspaper said.
Still, the tentative accords signal the end is near for the last in a series of probes of three different alleged abuses in the way major Wall Street firms handled IPOs during the Internet-stock boom, the Journal said.
In the proposed settlement agreements at hand, regulators have been probing since late 2000 whether firms such as Goldman and Morgan Stanley engaged in improper "laddering," where favoured IPO participants agree to buy more of the same shares after the stock has gone to market, the Journal said.
Goldman Sachs spokesman Peter Rose declined comment to Reuters on the newspaper report.
A Morgan Stanley representative was not immediately available for comment.
Last month, Morgan Stanley, Deutsche Bank AG and Bear Stearns Cos. agreed to pay a combined $15 million under a censure issued by brokerages regulator NASD for improper handling of shares in hot IPOs.