Wall Street & Technology is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Compliance

12:25 PM
Connect Directly
Google+
Twitter
RSS
E-Mail
50%
50%

Failure to Arbitrate Nets Merrill Lynch $1 Million Fine

The Financial Industry Regulatory Authority said it fined Merrill Lynch $1 million for failing to arbitrate disputes with employees over retention bonuses that were tied to its 2009 merger with Bank of America.

The Financial Industry Regulatory Authority said it fined Merrill Lynch $1 million for failing to arbitrate disputes with employees over retention bonuses that were tied to its 2009 merger with Bank of America.

The regulator said that following the merger, Merrill Lynch implemented a bonus program aimed at retaining high-producing brokers. But the program was designed by Merrill Lynch to force brokers to resolve any disputes over unpaid bonuses in court, ignoring FINRA's requirement that firms arbitrate such matters directly with employees.

In January 2009, Merrill Lynch paid $2.8 billion in retention bonuses that were structured as loans to more than 5,000 registered brokers. The firm agreed to pay the $1 million fine without admitting any wrongdoing, FINRA said. As the Senior Editor of Advanced Trading, Justin Grant plays a key role in steering the magazine's coverage of the latest issues affecting the buy-side trading community. Since joining Advanced Trading in 2010, Grant's news analysis has touched on everything from the latest ... View Full Bio

Register for Wall Street & Technology Newsletters
Video
Stressed Out by Compliance, Reputational Damage & Fines?
Stressed Out by Compliance, Reputational Damage & Fines?
Financial services executives are living in a "regulatory pressure cooker." Here's how executives are preparing for the new compliance requirements.