Merrill executive spared any fine after BofA's $415M penalty

Bank of America's Merrill Lynch unit paid $415 million last year to resolve allegations that it misused customers' cash. On Friday, the SEC finally got around to settling a case against the former bank executive who it said was ultimately responsible.

His penalty was considerably lower: Nothing.

William Tirrell, the former head of regulatory reporting at Merrill Lynch, negligently caused the firm to violate securities rules, the SEC said in an order Friday. The regulator ordered Tirrell to "cease and desist" from any future transgressions.

"The terms of the settlement ― no fine, no suspension, no penalty ― speaks for itself," Steven Witzel, Tirrell's attorney, said in an emailed statement. "After four years of investigation by the SEC, Mr. Tirrell is more than ready to put this matter behind him and move on with his life."

Bank_of_America_glass_window_Bloomberg
Bank of America Corp. signage is displayed at a branch in New York, U.S., on Tuesday, Sept. 3, 2013. Bank of America Corp. rose in New York trading after setting a $1.5 billion goal for its sale of China Construction Bank Corp. shares, a deal that will end an eight-year investment in the Chinese lender. Photographer: Ron Antonelli/Bloomberg via Getty Images
Bloomberg/Bloomberg via Getty Images

SEC spokeswoman Judith Burns declined to comment. The agency didn't issue a press release announcing the settlement with Tirrell.

The SEC's June 2016 settlement with Merrill Lynch was one of its biggest cases of the year by dollar amount. The firm admitted wrongdoing over allegations that it engaged in a series of complex options transactions from 2009 to 2012 that freed up billions of dollars per week that the firm used to finance its own trades.

Daniel Fagan, MSPFP, MPA, AIF, is managing partner at Radiant Wealth Management, an independent firm in Connecticut specializing in financial planning for academics, physicians and high net worth families.

He previously spent 17 years at TIAA advising faculty at top universities including Yale, UConn, Wesleyan and other leading institutions.

May 30
Dan Fagan of Radiant Wealth

Russell Curzon has over 20 years of commercial experience in the payments industry. As vice president of commercial sales at Nuvei, Curzon and his team are building Nuvei's market share in the UK and Ireland and helping businesses with Nuvei's next-generation payments technology.

May 30
Headshot of Russell Curzon

As Gen Z navigates student debt, housing costs and a slew of other financial pressures, many have become disillusioned with the possibility of retirement. Financial advisors say that can make planning difficult, but not impossible.

May 30
4 Min Read
Upset woman sitting inside office at table with crumpled papers, businesswoman financier disappointed with performance results, accountant dissatisfied with report

The options transactions had no economic purpose, and were done to reduce the amount of money that Merrill Lynch had to have on hand to meet customer claims. While no customer money was lost, clients would have been exposed to "significant risk" had Merrill collapsed at the time the infractions were occurring, the SEC said.

"The settled order expressly acknowledges that no investors were ever harmed by the trade at issue, and that there was no intentional misconduct," Witzel said.

The SEC filed its lawsuit against Tirrell in June of last year. The agency now has different leadership. Its chairman is Jay Clayton, a former Wall Street deals lawyer appointed by President Trump. The agency also has new officials overseeing its enforcement division.

Bloomberg News
Regulatory actions and programs Compliance Litigation SEC Bank of America Bank of America Merrill Lynch
MORE FROM FINANCIAL PLANNING