Ex-Morgan Stanley VP Charged with Embezzling $2.5M

A former vice president at Morgan Stanley has been accused of embezzling more than $2.5 million from the investment bank over a seven-year period.

New York prosecutors say Richard Garaventa Jr. used the money to make mortgage payments, renovate his home, buy a Mercedes and a Lexus, take vacations in Aruba and Florida, buy jewelry and dine in restaurants, according to the Wall Street Journal (sub. req.) and the Associated Press.

Morgan Stanley became suspicious when it noticed irregularities in the books when Garaventa was on vacation, the New York Daily News reports. Garaventa had been authorized to write checks to clients for dividends, but deposited some of the money into the account of a company he created called NY Transfer Corp., prosecutors allege.

"It certainly was a transfer corp.—their money got transferred to him," a law enforcement source told the Daily News.

Garaventa was vice president in the operations division of Morgan Stanley's institutional securities business. He was charged with grand larceny, falsification of business records and criminal possession of stolen property, according to the Wall Street Journal account. He is denying the allegations.