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Merrill Lynch Advisor Sanctioned for Unauthorized Trading

Posted on March 24th, 2025 at 2:58 PM
Merrill Lynch Advisor Sanctioned for Unauthorized Trading

From the desk of Jim Eccleston at 麻花传媒

FINRA has fined a former Merrill Lynch advisor $5,000 and suspended the advisor for 30 days for executing unauthorized trades in client accounts. AdvisorHub reports that the advisor accepted the sanctions without admitting or denying FINRA’s findings.

The settlement agreement, known as an Acceptance, Waiver, and Consent (“AWC”), reflects that the advisor placed 204 unauthorized trades across four customer accounts, three of which belonged to senior investors. Although the advisor discussed investment strategies with the clients, FINRA found that the advisor failed to obtain the required written authorization for non-discretionary accounts. Those actions violated FINRA’s prohibition on unauthorized trading as well as Rule 2010, which requires advisors to uphold high ethical standards.

AdvisorHub reports that the disciplinary action stemmed from a FINRA “cause examination,” an investigation triggered by a complaint or tip.

Since 2022, the advisor has faced nearly two dozen customer complaints, many related to allegations of unsuitable or unauthorized options trading. Merrill Lynch denied 10 of the claims but paid approximately $2.1 million in settlements on 12 others, out of a total of $4.75 million in damages requested.

 

麻花传媒 LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

Tags: eccleston, eccleston law

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