SEC, FINRA Fine Merrill Lynch

Following on the heels of Merrill Lynch’s agreement yesterday to pay $415 million to settle claims made by the SEC, the commission and FINRA fined the firm an additional $15 million in another action brought by the SEC and a third brought by FINRA.

[su_spacer size=”10″]In an announcement yesterday, the SEC stated that Merrill Lynch agreed to pay a $10 million penalty to settle claims that it made misleading statements in materials provided to retail investors for structured notes linked to a proprietary volatility index. These materials highlighted the commissions that were charged and the annual fee. However, they failed to disclose a quarterly cost of 1.5% that was tied to the value of the volatility index.

[su_spacer size=”10″]The notes were issued by Bank of America. Merrill Lynch had “principal responsibility for drafting and reviewing the retail pricing supplements,” the SEC said.

[su_spacer size=”10″]FINRA stated that it also fined the firm $5 million for “negligent disclosure failures” in the sale of the volatility-linked structured notes. Merrill Lynch neither admitted nor denied the structured note charges made by SEC and FINRA.

[su_spacer size=”10″]If you or someone you know has lost money as a result of an investment or Ponzi scheme, please contact Richard Frankowski at 888-741-7503 to discuss your potential legal remedies or complete the contact form.