Defendant Name: Merrill Lynch Professional Clearing Corporation

Defendant Type: Subsidiary of Public Company
Public Company Parent: Bank of America Corporation
SIC Code: 6021
CUSIP: 06050510

Initial Case Details

Legal Case Name In the Matter of Merrill Lynch, Pierce, Fenner & Smith Incorporated and Merrill Lynch Professional Clearing Corp.
First Document Date 23-Jun-2016
Initial Filing Format Administrative Action
File Number 3-17312
Allegation Type Broker Dealer

Violations Alleged

Exchange Act
Sec 15(c)
Section 17(a)(1) Exchange Act; Rules 15c3-3, 17a-3(a)(10), 17a-5(a) Exchange Act


First Resolution Date 23-Jun-2016
Headline Total Penalty and Disgorgement

See Related Documents

Related Documents:

2016-128 23-Jun-2016 Press Release--Administrative Proceeding
Merrill Lynch to Pay $415 Million for Misusing Customer Cash and Putting Customer Securities at Risk
34-78141 23-Jun-2016 Administrative Proceeding
Order Instituting Administrative and Cease-and-Desist Proceedings, Pursuant to Sections 15(b) and 21C of the Securities Exchange Act of 1934, Making Findings, and Imposing Remedial Sanctions and a Cease-and-Desist Order
On June 23, 2016, the SEC instituted settled administrative and cease-and-desist proceedings against Merrill Lynch, Pierce, Fenner & Smith Incorporated ('MLPF&S") and Merrill Lynch Professional Clearing Corp. ("MLPro"), collectively referred to as "ML". According to the SEC: "Broker-dealers are required to be diligent stewards of the cash and securities entrusted to them by their customers. This basic principle is embodied in Exchange Act Rule 15c3-3, known as the Customer Protection Rule ('Rule'). The Rule requires broker-dealers to safeguard both the cash and securities of their customers so that customer assets can be quickly returned if the firm fails. In broad strokes, a broker-dealer cannot use customer assets to finance the business activities of the firm, and it cannot place customer assets in locations or accounts that make them vulnerable to claims made against the broker-dealer by third parties. This matter arises from significant violations of the Customer Protection Rule that began during the Financial Crisis and, in certain respects, continued until this year. The violations were twofold. First, ML used cash belonging to its customers to fund its own business activities through a series of increasingly complex trades. Second, at the same time and continuing for years due to poor oversight and weak controls, MLPF&S allowed certain of its clearing banks to hold general liens over tens of billions of dollars of securities owned by its customers."

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