Securities Arbitration Attorneys, 20 June 2015
Bank of America subsidiary Merrill Lynch, Pierce, Fenner & Smith Inc. has been fined $1 million by the Financial Industry Regulatory Authority, or FINRA, for failure to supervise one of its stockbrokers at its branch office in San Antonio, Texas. FINRA announced the fine on Oct. 4.
Bruce Edward Hammonds, a registered representative with the firm, used a Merrill Lynch account to operate a Ponzi scheme, luring 11 people to invest more than $1 million in B&J Partnership, an entity he ran for over 10 months, according to information released by FINRA. Hammonds request to open a business account for B&J was approved by Merrill Lynch supervisors, who subsequently failed to monitor the funds that the investors deposited and Hammonds withdrew. He was fired by Merrill Lynch in June 2008.