Unless these preferred clients are active traders, this isnt a problem. Remember when government nixed fiduciary resposibility?
Just slide a soon-to-drop, over-valued-at-IPO stock into say,... someones' retirement account? Wouldnt it be weird if a bunch or Morgan-Stanley-managed 401Ks were shifted to include that?
Especially if the bank managing the IPO gets a cut of the cash, there's no downside to such. At least for them.