After a power struggle with Jeff Beck, Phillip Ean Cohen left Oppenheimer & Co. to start his own firm.

Despite this, Morgan Schiff initially operated as the Private Equity arm for Drexel Burnham Lambert, and was located directly under Milken's office.

When Business Week asked Cohen about the name, he replied, "It was my belief that investment banks should go back to advising clients in a closer format, as in the days of J.P. Morgan and Jacob Schiff."

Cohen was considered one of the top minds in Mergers and Acquisitions, and was able to recruit many of his corporate clients from his days at Kuhn Loeb, Lehman Brothers, First Boston, Oppenheimer, and Drexel Burnham Lambert.

[2] One of these clients was Zale Corporation, which used Morgan Schiff as an adviser on a $500 million Merger, officially becoming the company's first transaction.