Merrill Lynch Sold Strategic Return Notes To Retail Investors
If you are an investor who lost money from Strategic Return Notes (SRNs) that were sold by Bank of America’s (BAC) Merrill Lynch, please contact our investment fraud lawyers at Shepherd Smith Edwards and Kantas, LLP (SSEK Law Firm) today.
The investment raised about $150M from their sales and caused substantial losses from many. SSEK Law Firm is committed to helping Strategic Return Notes investors to recoup their losses.
Touted as investments linked to the Investable Volatility Market (VOL), SRNs were even too complicated for Merrill Lynch brokers to fully comprehend, let alone explain to their clients. In fact, SRNs were unsecured promissory notes that Bank of America never had an obligation to pay interest on, even if they were held until maturity in 2016.
There was also never any guarantee that investors could expect to get back the notes’ original purchase price upon maturity. Instead, they could get a variable amount determined by the performance of the VOL, which is a complex index that gauges the S & P 500’s volatility.
SRNs investors are now saying they were never fully apprised of the risks involved nor did they understand what they were. Instead, misrepresentations that were allegedly in documents caused many of them to think they could expect “enhanced” income and returns. Also, these promissory notes are not suitable for every kind of investor due to their complexity and the risks involved.
SEC Fines Merrill Lynch $10M
In 2016, the US Securities and Exchange Commission (SEC) ordered Merrill Lynch to pay a penalty of $10M to settle charges accusing the brokerage firm of making misleading statements in offering materials that were given to retail investors about SRNs.
The settlement came just one year after the SEC reached a separate $19.5M settlement with UBS AG over allegations that it had made misleading and false statements and omissions in offering documents about structured notes that were linked to a specific foreign exchange trading strategy.
Structured Return Note Fraud Attorneys
Many investors sustained huge losses from buying Merrill Lynch’s Structured Return Notes. Over the years, our brokerage firm misconduct lawyers at SSEK Law Firm have gone up against the biggest broker-dealers on Wall Street on behalf of our clients in helping them to recoup their money.
Contact our Structured Return Note lawyers today.