Our Broker Fraud Lawyers at Shepherd Smith Edwards and Kantas Are Continuing To Investigate

Following a $39 million class action settlement where Merrill Lynch was accused of paying near-zero interest on retirement cash accounts, our Broker Fraud Lawyers at Shepherd Smith Edwards and Kantas are continuing to investigate affected investors. These securities attorneys help clients evaluate whether to remain part of a class action or pursue individual FINRA arbitration to maximize their recovery for mismanaged cash sweep programs.

In a class action settlement, Merrill Lynch agreed to pay $39M over allegations that it didn’t pay enough interest to brokerage clients holding cash. Instead, contend the plaintiffs, the brokerage firm paid close-to-zero interest rates rather than market rates on the cash in their retirement accounts.

It was just last year that the US Securities and Exchange Commission (SEC) ordered Merrill Lynch to pay a $25M penalty after finding that it did not pay clients with advisory accounts enough interest. A number of other broker-dealers also paid many millions of dollars in class action cases for allegedly not paying customers enough interest on uninvested cash.

Merrill Lynch’s latest settlement involves Merrill Edge online account holders between December 15, 2016 ​and March 15, 2020. They contend that they received 0.05% to 0.14% in interest even as customers of other broker-dealers were paid about 2%.

Financial advisors have come under scrutiny for some time over their handling of cash sweep accounts. This is the kind of account in which excess cash in a primary account is automatically moved into a higher-yield or debt reducing vehicle.

Shepherd Smith Edwards and Kantas (investorlawyers.com) is speaking to investors in cash sweep programs that are looking to explore their legal options.

I’m an Investor Who Works With a Brokerage Firm. How Do I Know if I Have Grounds for a Claim Against My Broker Over a Cash Sweep Program?

• Depending on how much interest you weren’t paid will make a huge difference on whether it makes sense to stay a class action plaintiff or file your own claim for financial recovery. A lot of this will depend on the kind of cash sweeps program you are involved in and how much money you could have earned. With class action litigation, plaintiff members don’t get much back.
• Our trusted securities lawyers work with investors who have suffered losses because their broker breached their agreement, made an unsuitable investment recommendation, engaged in some sort of unjust enrichment, ignored their best interests,failed to properly supervise their account, was negligent in some other way, or committed some other kind of broker misconduct.

Shepherd Smith Edwards and Kantas can tell you whether your cash sweep interest losses warrant pursuing an investor claim against your financial advisor.

Can I Stay Part of A Class Action Lawsuit and File an Individual Claim Against My Broker?

It is important to note that you can’t both remain part of a class action claim and also file a FINRA arbitration case over the same losses against your broker-dealer. This is why it is crucial that you speak with seasoned securities lawyers who can explore your legal options with you.

FINRA arbitration is where individual claims against brokers are made. That is because as a customer of a broker-dealer you likely signed an arbitration agreement in which you consented not to sue in court.

Talk To Us Today About Your Cash Sweep Program Losses

Call (800) 259-9010 or contact us online to request your free case consultation.