Morgan Stanley Probed Over Lastminute

It is now believed that the US Securities & Exchange Commission (SEC) is investigating the bank's role in the flotation of Lastminute.com, the online travel company and have asked for documents and e-mails to be handed over.

Morgan Stanley do not feel that they will be embarrassed by any disclosures resulting from the probe and it is felt unlikely that they will face the same concerns building at Merrill Lynch. An e-mail was recently made public in which a Merrill technolgy analyst disparaged as 'shit' a company the firm was advising clients to invest in.

The SEC is expected to focus on the work of Morgan Stanley analyst Mary Meeker, the so-called 'Queen of the Net', who co-authored the up-beat research on Lastminute a month after her firm managed its London float. The company was listed at 380 and dived almost immediately post float. Several investors lost their shirts. The current price is around 90.

There is no suggesion of any wrongdoing on the part of Lastminute.com, who are not under investigation.