What will become of Julian Tzolov and Eric Butler, the former Morgan Stanley (NYSE: MS) employees who each got a $4.5 million loans from the firm when they joined in 2007. Their Morgan Stanley careers did not end well. The two were soon charged by the SEC (SEC news) for conspiring to defraud investors in auction rate securities in deals engineered while they were still at Credit Suisse (Credit Suisse news).

Some are now outraged that a FINRA (FINRA news) panel has decided that the two men do not have to pay back the loans. Morgan Stanley, which had accused Tzolov and Butler of fraudulently inducing it to hire them, wants its money back. For the record, as Fortune notes, Tzolov pleaded guilty to fraud and is awaiting sentencing. He helped the Justice Department in a case against Butler, who was convicted of securities fraud and faces five years in jail. He's now out on bail.

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