Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Merrill Lynch fires brokers for promoting outside hedge fund - source

Published 20/09/2014, 00:35
Updated 20/09/2014, 00:35
© Reuters A Merrill Lynch building is shown in downtown San Diego, California

© Reuters A Merrill Lynch building is shown in downtown San Diego, California

NEW YORK (Reuters) - Merrill Lynch fired two veteran brokers from its Private Banking and Investment Group two weeks ago for guiding clients to invest in a hedge fund outside of the brokerage firm.

The brokers, Stephen S. Brown and James P. Goetz, were based in Pittsford, New York, a suburb of Rochester, and managed about $2.5 billion (1.53 billion pounds) of assets for clients, according to a source familiar with their practice.

They were fired on Tuesday, Sept. 9, along with two client associates. Other members of their team remain, according to sources in the large office of about 40 individual brokers and teams.

Brown and Goetz, who had been with Merrill since 1991 and 1998, respectively, according to regulatory records, could not be reached for comment.

Selling investments or other products not vetted and processed by an adviser's employer is known as "selling away" and is a violation of securities industry rules. All advisers in the Pittsford branch were, within 24 hours of the departures, summoned to a meeting at which the seriousness of selling away was explained, several said.

Brown and Goetz continue to be listed as Merrill employees on the BrokerCheck website of the Financial Industry Regulatory Authority, and on their LinkedIn social networking pages. Brokerage firms have 30 days to update notices about brokers charged with violations or dismissed. The BrokerCheck website is http://brokercheck.finra.org/.

Brown and Goetz were members of Merrill's Private Banking and Investment Group, or P-BIG, which includes about 150 brokerage teams that focus on ultra-wealthy clients with at least $10 million to invest. The unit is headed by John Thiel, who also runs the branch system for the Bank of America Corp (N:BAC) subsidiary that employs about 13,845 U.S. brokers.

© Reuters. A Merrill Lynch building is shown in downtown San Diego, California

The pair's dismissal was reported earlier on the "Investment News" website.

(Reporting By Jed Horowitz and Elizabeth Dilts; Editing by Andre Grenon)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.