Letters are now going out to Bank of America investment clients explaining that in a couple of months, their accounts will move from Fidelity’s National Financial trade clearing and processing platform to the Merrill Lynch Pierce Fenner & Smith clearing platform, according to former BofA advisors.

But what seems like a minor back-office move could make a world of difference to BofA [BAC] clients and advisors.

Bank of America Investments (BAI) advisors officially became Merrill Lynch advisors in October, according to BofA spokesman Matthew Card. He said all new accounts since then are already on Merrill’s platform.

But questions surround what will happen to BAI clients when Merrill transitions their accounts from National Financial. Merrill will likely impose its account minimums on advisors, according to advisors and a former Merrill manager who declined to comment but corroborated the details of this story.

This might work in the high-net-worth world of the traditional brokerage, but bank-brokerage clients won¹t necessarily meet Merrill¹s $250,000 minimum to work with an advisor.

BofA clients who don’t make the grade at Merrill will be shunted to a call center, according to a former BofA advisor turned independent. Card said that clients of any account size get to choose whether they want to work with an advisor or a call center, although “our Direct Investment Division will generally serve clients with a combined banking and investment relationship of less than $250,000.”

In other words, clients with less than $250,000 in assets generally prefer not to work one-on-one with an advisor.

Carl Cafaro, a legacy BAI advisor and team-leading $2 million producer in Newton, Mass., said he doesn’t think Merrill is likely to enforce its minimums.

“Everything I’ve seen in writing is that advisors can run their books as we want and that there will be no mandatory movement of clients,” he said. “As an advisor, you could look at your practice and focus on clients with more money, but nobody’s making you do it.”

The former BofA advisor, who did not wish to be identified, disagreed with Cafaro. “Before I left, they gave us our runs of all our clients earmarked for the call center,” he said. “Wave One was for clients under $75,000, Wave Two was clients under $100,000 and Wave Three, which was after I left, was for clients under $250,000.”

Advisors agree, though, that Merrill’s platform is more robust. A former BofA advisor, who moved to a competing big bank, said, “BofA ran it like a second-class operation in terms of tools and technology and compared to where I am now there’s no comparison. It’s unbelievable how behind the times BofA was.”

The big-bank advisor said that at BofA his list of available funds to recommend was 130 to 150 strong, and didn’t include the popular American Funds, which notably doesn’t pay institutions for order flow as other fund families do. By comparison, his new firm lists 3,000 or 4,000 available funds.

But at legacy BofA, clients could sit down and talk to an advisor regardless of how much in assets they had.

“You’ve got to have personal service – a lot of BofA clients are under $100,000,” according to the independent advisor. “They deserve being able to visit a broker in a branch.”

“You don’t get people used to a level of service and then take it away,” the big-bank advisor said. “I have a lot of clients who weren’t happy at all with the way they were being treated. You can’t tell me this is the right thing for customers, but do they [BofA executives] really care about their brokerage clients? I guess they just want to let that business go.”

Card, who concedes most sub-$250,000 clients will choose to work with a call center rather than in person with a Merrill advisor, said that there will soon be Merrill advisors in BofA branches. The bank rolled out an in-branch program late last year in Boston, Chicago and Seattle, in which advisors “offer clients access to face-to-face assistance (within their local branch) with organizing their finances and developing a financial plan using Merrill Lynch’s world class analytical tools and technology.”

Card said that these advisors help “ensure that [clients] are introduced to the appropriate Merrill Lynch service channels that best meet their needs.” The program, which Card said has met with success, will soon be rolled out in other areas of the country.

 “We have been successful in our efforts to thoughtfully and rapidly integrate our banking and brokerage businesses,” Card said, but other accounts suggest BofA advisors’ transition to Merrill Lynch management has not been a happy one so far.

Rick Rummage, a managing partner of the Rummage Group, a recruiting firm in Reston, Va., said that out of 2,500 reps before the bank bought Merrill, roughly 1,000 have already left and he predicts as many as half of the BofA advisors still there will quit within the next 12 months.

“Merrill doesn’t care,” Rummage said. “It wants the accounts, not the brokers. It doesn’t have any respect for bank reps at all. [BofA reps] are making the best of it, but they’re fish out of water.”

“It’s pretty much a disaster,” according to the independent advisor, who said his complex has dwindled from a staff of 40 to just six in the past year.

Things are bound to get worse, the independent advisor said, and it isn’t all the fault of Merrill’s notoriously cocky culture and sky-high production goals, anathema to the average bank rep. “It’s total confusion and BofA is beginning more and more to push product, which is not good for anyone,” advisors or clients, he said.

Managers of what was BAI are allegedly pushing advisors to sell managed accounts, even though the independent advisor said there isn’t much active management going on.  “Clients are being moved to a fee-based structure, but into portfolios that are completely static when what they’re paying for is economic guidance built around their individual needs,” he said.

BofA clients would have more options for fee-based accounts on Merrill’s platform, but only if they meet Merrill’s account minimums — and many don’t. The bank’s plan is to charge the sub-$250,000 minimum brokerage clients a fee wherever possible for their accounts at call centers, the independent advisor said. Card denied this.

The independent advisor said: “Customers have no clue that their accounts are not being managed, and the fees are out of control — they’d be better off in an S&P fund. It’s an embarrassment. The majority of these clients are still sitting in long positions and not being managed, but they don’t know any better because they’re not educated.”

Moving many of BofA advisors’ clients to the call center will hurt advisors too. “It’s a huge problem,” the independent advisor said. “There may be thousands of accounts under Merrill’s minimums, which will mean a massive drop in production for BofA reps when they join the Merrill platform in a couple of months” and are forced to ditch their smaller clients.

That’ll make life even more unpleasant for BofA reps who have below average production. “Merrill is playing real nice right now, no heavy sales pressure. But where a broker has a $250 million book and isn’t producing $3 million, it makes more sense to Merrill to lose the broker and split up his book,” the independent advisor said. “A lot of BofA guys at Merrill right now are thinking it isn’t that bad. But once their assets are on the Pierce system, Merrill is famous for flicking the switch. The guys still there will end up walking away with nothing.”

With their advisors gone, former BofA clients will find themselves subject to a brokerage experience they didn’t sign up for and higher fees at Merrill than they’re used to. “Clients are getting the short end of the stick,” the big-bank advisor says. “As they merge the systems together there will be a lot of unhappy clients, especially as their advisors leave.”

That isn’t to say that Merrill advisors are thrilled with the situation either. Well over 1,000 Merrill advisors have already quit, distressed by BofA’s tinkering with the management structure.

Card said that while a few advisors may have left the firm, many of their clients have remained. “Among the small population of financial advisors who have chosen to leave the firm, more than 60% of their clients have chosen stay with us; this is a testament to the strength of our platform and the confidence our clients have that this is the best place to do business,” he said.

While BofA remain confident in its marriage with Merrill, advisors think the bank will wind up selling Merrill within five years. “I would not be shocked at all,” the big-bank broker said. “BofA’s attitude to brokerage was that it is a necessary evil, but it didn’t like it. With Merrill, they realized they could get a brokerage for cheap, but then they found out it was junk and they didn’t want it anymore. Things are getting more distanced, so it’s more Merrill over here and more BofA over there. Soon Merrill will be its own entity that BofA can sell if it wants to, and it definitely will.”