Merrill To Pay $26.5 Million Fine Over Unregistered Salespeople

The Merrill Lynch unit of Bank of America will pay up to $26.5mn in a national settlement stemming from a claim that Merrill allowed unregistered salespeople to sell securities. Commissioner Denise Voigt Crawford said the Texas State Securities Commission had led a multi-state task force that investigated Merrill's "failure to supervise its client associates."

The probe followed a tip from a Merrill employee made in May 2008, before the firm agreed to be acquired by Bank of America. The tip said the company saved registration fees by having client associates register in just 2 states - their home state and one neighboring state. Besides Texas, the participating states were Colorado, Arizona, Missouri, Vermont, New Hampshire and Delaware.

Source: Compliance Insights