A collection of four public interest groups wants the Federal Reserve to reject Morgan Stanley’s planned $13 billion purchase of E-Trade.
The groups said in a release that the the acquisition plan "poses real risks to competition and financial safety" and that the Fed has "no business waving through yet another merger that makes one of our nation's biggest banks even bigger."
"This merger won’t just harm consumers, it will put our entire economy at risk. This too big to fail merger is too big to approve," said Lisa Gilbert, executive vice president of Public Citizen, in a press release.
They also released a public letter addressed to Federal Reserve Chairman Jerome Powell arguing that Morgan Stanley has a troublesome past including "repeated legal violations that harm customers and investors, and investments that harm society show that it is already 'too big to manage.'"
The letter was endorsed by the American Economic Liberties Project, Demand Progress Education Fund, Income Movement and Public Citizen.
The acquisition, announced in February, shows Morgan Stanley's interest in catering to everyday consumers, especially as beginner-focused trading apps like Robinhood rise in popularity.
Morgan Stanley (MS) and E-Trade (ETFC) said they were hopeful the merger would be approved by regulators and shareholders by the fourth quarter of 2020.