Merrill Lynch Fined by FINRA for Failing to Report More Than 1,600 Customer Complaints
From the desk of Jim Eccleston at Eccleston Law
Merrill Lynch has agreed to pay a $225,000 fine and accept a censure to resolve allegations that it failed to properly identify and report more than 1,600 customer complaints submitted through post-call surveys, according to a Financial Industry Regulatory Authority (FINRA) Acceptance, Waiver and Consent letter ("AWC").
According to FINRA, Merrill Lynch failed to reasonably review written comments submitted by customers following calls to the firm's service centers between 2018 and 2023. AdvisorHub reports that customers had the opportunity to complete surveys that included open-ended comment sections where they could provide feedback about their experiences.
FINRA noted that Merrill received more than 220,000 survey responses in 2023 alone. While the firm reported approximately 2,400 complaints that year, the flawed supervisory process caused it to overlook a significant number of additional reportable complaints. According to FINRA, many of the missed complaints involved customer service issues. Others involved more significant concerns, including difficulties accessing funds, obtaining account information or documents, technical issues involving online systems, and security-related incidents.
Merrill resolved the matter in the AWC without admitting or denying FINRA's findings. In determining the sanctions, FINRA credited Merrill for self-reporting the issue and conducting an internal review of survey responses. According to AdvisorHub, the regulator also noted that the firm addressed the complaints identified during its review and subsequently reported those matters to FINRA.
Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.
Tags: eccleston, eccleston law, finra enforcement, merrill lynch, regulatory compliance, customer complaints, securities law
