{"id":4467,"date":"2007-06-24T05:26:56","date_gmt":"2007-06-24T05:26:56","guid":{"rendered":"https:\/\/www.stockbrokerfraudblog.com\/2007\/06\/do_wall_street_powerhouses_ear"},"modified":"2021-09-20T15:41:35","modified_gmt":"2021-09-20T20:41:35","slug":"do-wall-street-powerhouses-ear","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/do-wall-street-powerhouses-ear\/","title":{"rendered":"Do Wall Street Powerhouses Earn Billions Through Fraudulent Fund Sweeps?"},"content":{"rendered":"

\t\t\t\tMerrill Lynch, Morgan Stanley, Smith Barney and Charles Schwab are being sued for claims they improperly directed their clients’s funds into lower paying deposit accounts at affiliate banks, enabling those banks to reap billions in extra profits. Attorneys for investors seek permission to add Wachovia, based on “sweep” accounts it will receive from AG Edwards in an impending merger.<\/p>\n

Details of the suit, filed in January but amended last month, had not previously been reported. Bank deposit sweep programs “put the broker in a very conflicted position” said an attorney for the investors recently, adding “this is not what they should be doing as financial advisers.”<\/p>\n

The claim states that the firms are positioning themselves as objective financial advisers, but send their customers’ funds into bank deposits paying far less than market rates, adding that the firms disclose to clients that more profitable accounts are available, but bury the disclosures in documents while failing to mention the magnitude of their profits.<\/p>\n

Continue Reading \u203a<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"

Merrill Lynch, Morgan Stanley, Smith Barney and Charles Schwab are being sued for claims they improperly directed their clients’s funds into lower paying deposit accounts at affiliate banks, enabling those banks to reap billions in extra profits. Attorneys for investors seek permission to add Wachovia, based on “sweep” accounts it will receive from AG Edwards […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3827,3800,3787,3821],"tags":[],"class_list":["post-4467","post","type-post","status-publish","format-standard","hentry","category-a-g-edwards","category-merrill-lynch","category-morgan-stanley","category-wachovia"],"yoast_head":"\nDo Wall Street Powerhouses Earn Billions Through Fraudulent Fund Sweeps? — Investor Lawyers Blog — June 24, 2007<\/title>\n<meta name=\"description\" content=\"Merrill Lynch, Morgan Stanley, Smith Barney and Charles Schwab are being sued for claims they improperly directed their clients's funds into lower paying — June 24, 2007\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.investorlawyers.com\/blog\/do-wall-street-powerhouses-ear\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Do Wall Street Powerhouses Earn Billions Through Fraudulent Fund Sweeps? 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