A couple months ago, a Financial Industry Regulatory Authority (FINRA) panel awarded two former Merrill Lynch (ML) brokers in excess of $10 million dollars as a result of an alleged deferred compensation scam orchestrated by ML after the firm merged with Bank of America in 2008.
Industry observers believe this decisoin will spur additional litigation on behalf of other former ML brokers who are similarly situated. For its part, ML has appealed the award citing alleged bias on the part of the panel chair person. Arbitration awards are rarely overturned and this appeal will be watched closely by the interested parties.
The three-person panel awarded former Merrill brokers Tamara Smolchek and Meri Ramazio $4.3 million and $875,000, respectively, in compensatory damage, plus another $5 million in total punitive damages. Further, the panel awarded an aditional $100,000 for discovery abuse on the part of ML. It is believed the Claimants were able to obtain sensitive documents that showed ML was not adhearing to their own policies in denying deferred compensation claims.
For additional details, go to an April 8, 2012 Investment News article found here.