Massachusetts has issued a fine of $5 million against Morgan Stanley (PDF) over improprieties during Facebook’s initial public offering (IPO) earlier this year. The deal, announced Monday, is a settled amount the investment bank came to with state regulators—neither admitting nor denying guilt. To put that fine in perspective, Morgan Stanley’s Q3 2012 net revenue was $5.3 billion.

The investment bank was the lead underwriter for the IPO and had been accused of improper influence between its bankers and research analysts who cover Facebook.

Before Facebook’s much-watched IPO, the company issued an amended prospectus (S-1 filing), which indicated a lower revenue model. That, in turn, prompted a number of analysts to lower their expectations for Facebook’s financial performance.

An investment banker in California not named in the official settlement (who the New York Times identified as Michael Grimes) is accused of being personally involved with the decision to not only make the S-1 filing, but also the decision to communicate new information to analysts.

“Morgan Stanley’s senior investment banker did everything but make the phone calls himself,” Massachusetts Secretary of State William F. Galvin said in a statement. “He not only rehearsed with Facebook’s treasurer who placed the calls to the research analysts, but he also drafted the majority of the script Facebook’s treasurer utilized when calling the research analysts.”

The investment bank, in its own statement released to the media, said it was “pleased” with the settlement. “Morgan Stanley is committed to robust compliance with both the letter and the spirit of all applicable regulations and laws.”