(Reuters) -Massachusetts securities regulators have fined Morgan Stanley ( MS ) $2 million for failing to properly monitor trades by a First Republic Bank insider before the bank failed, a spokesperson for the regulator said on Friday.

Morgan Stanley ( MS ) held the account for a former insider at First Republic, and failed to affirm with the customer that the individual was not trading based on material nonpublic information at the time, the spokesperson said. The settlement was first reported by the Wall Street Journal.

A spokesperson for Morgan Stanley ( MS ) said the firm was pleased to have resolved the matter.

The Secretary of the Commonwealth of Massachusetts's resolution with the bank does not name the insider, but the Wall Street Journal named the individual as James Herbert II, the then-executive chairman of First Republic.

Massachusetts regulators did not accuse Herbert of wrongdoing as part of the investigation, the spokesperson said. He could not be reached immediately for comment.

Morgan Stanley ( MS ) neither admitted nor denied wrongdoing, according to the Journal.