Mitsubishi UFJ Financial Group's (MUFG) investment banking venture with Morgan Stanley is facing potential penalties for sharing client information, leading to the loss of at least two bond deals in Japan. Aeon has dropped MUFG's investment banking unit from arranging a planned bond sale due to these issues. Japan's securities watchdog has recommended actions against MUFG Bank and its brokerages for illegally sharing client data, breaking firewalls between business units designed to protect such information. This situation puts MUFG at risk of losing more bond underwriting deals. Japan Securities Watchdog has been actively involved in this investigation.