Morgan Stanley late Monday became the fourth major securities firm to propose a buy-back of auction-rate securities from retail investors, but the offer was rebuffed by New York Attorney General Andrew Cuomo.

The firm, ranked fourth-largest ARS underwriter according to Thomson Reuters, proposed a series of voluntary actions that would follow the blueprint established in state and federal regulator settlements with Citigroup Global Markets and UBS last week, including repurchasing at par $4.5 billion of ARS from retail investors.

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