Merrill Lynch Fined $500,000 for Laxity in Filing Reports
Merrill Lynch, Pierce, Fenner & Smith Inc. was fined a hefty $500,000 by the nation’s largest independent securities regulator for inadequacies in filing hundreds of reports including customer complaints, arbitration claims, and related U4 and U5 filings.
The Financial Industry Regulatory Authority (FINRA) said that the violations by Merrill Lynch included, among other things, more than 650 cases of failure to file or to file in a timely way reports of customer complaints and settlements between 2007 and 2011.
Investors were also not able to use BrokerCheck, FINRA’s public disclosure program to help consumers assess a broker’s background. Merrill’s failure to file the required reports also hampered the ability of other firms to conduct background checks when making hiring decisions, reduced the ability of securities regulators to review brokers' transfer applications, and hindered FINRA from promptly investigating certain disclosure items.
Merrill was also censured by FINRA. However, it neither admitted nor denied the charges as part of the settlement.
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