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Morgan Stanley’s Atwan Leaves After Review Tied to Lawsuit

Morgan Stanley’s Atwan Leaves After Internal Review Tied to Suit

A Morgan Stanley managing director who oversaw its energy-infrastructure investments has left the bank following an internal review tied to a lawsuit accusing him of fraud, according to people with knowledge of the matter.

The departure came after Morgan Stanley and Ahmad Atwan, who was based in Houston, were among defendants in a complaint filed in Texas, said one of people, who asked not to be identified because the information is private. He was placed on indefinite leave on Dec. 31, and his employment was terminated on July 6, according to the people.

The complaint, filed by firms affiliated with billionaire Enrique Razon, accused Atwan and several entities of fraud in a real estate transaction, misrepresentation and breach of fiduciary duty. The two Houston-based companies, Collingwood USA Inc. and Collingwood Brookshire USA Inc., accused Atwan of failing to disclose conflicts of interest, improperly collecting fees from multiple parties in a move they described as “double dipping” and other wrongdoing. The accusations are unrelated to Morgan Stanley’s investments.

“It is incredible to me that Collingwood and Enrique Razon have chosen to file a frivolous lawsuit against me and others,” Atwan said in an emailed statement. “I am confident that I will be able to defeat these baseless claims.

“The malicious reason this surfaced almost a year after the lawsuit was filed and months after leaving Morgan Stanley, will become clear in time,” Atwan said.

Morgan Stanley, which raised $5.5 billion for its third infrastructure fund in December, notified its investors about Atwan’s departure in recent months, people with knowledge of the matter said, which is common practice when senior investment professionals leave a firm. Investors in the third vehicle include the New York State Common Retirement Fund and the Teacher Retirement System of Texas, according to data compiled by Bloomberg.

“Morgan Stanley denies the claims related to the firm in the ligation involving Ahmad Atwan, and we intend to vigorously defend ourselves in court,” Lauren Bellmare, a Morgan Stanley spokeswoman, said in a statement. She declined to comment on Atwan’s leave or departure.

Atwan is slated to join HIG Capital as a managing director this month, according to people with knowledge of the matter. A HIG spokesperson didn’t immediately respond to a request for comment. Atwan joined Morgan Stanley in 2013 from BlackRock Inc., where he helped lead its energy-focused private equity efforts. He was named a managing director in 2015.

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