Regulators Won’t Cite Morgan Analyst

Mary Meeker, the high-powered Morgan Stanley Internet analyst, will escape accusations brought against other star analysts of the 1990s technology boom, a source familiar with the matter said Wednesday.

The source confirmed a report Wednesday in the Wall Street Journal that said regulators, led by New York State Atty. Gen. Eliot Spitzer and the Securities and Exchange Commission, will not cite Meeker or Morgan Stanley for securities fraud.

A Morgan Stanley spokeswoman declined to comment on the newspaper report.

Morgan Stanley was part of a $1.4-billion deal between regulators and 12 investment banks to settle an investigation into Wall Street’s research and initial public offering allocation practices. The firm agreed to pay a $50-million fine and $75 million to fund independent research as part of the settlement.

Along with Jack Grubman of Citigroup Inc.’s Salomon Smith Barney and Henry Blodget of Merrill Lynch & Co., Meeker was a high-profile analyst covering the stock market’s hottest industries during the late 1990s and early 2000. Meeker is the only one of the group that still is working in the securities industry.

Morgan Stanley executives have maintained that their analysts did nothing wrong.