Merrill Lynch curtails asset managers’ perks for advisors
The free lunches are over. Sort of.
Merrill Lynch is placing new limits on the perks its advisors receive from third-party asset managers.
The move restricts long-held practices, but likely won’t have a big immediate impact given that the coronavirus pandemic has curbed events such as dinner parties and in-person meetings.
Merrill Lynch told employees they are permitted to accept novelty items bearing asset managers’ name and logo, but the items must cost less than $50. Previously, employees could accept a gift valued up to $100 per firm, per year.
Employees can only accept meals provided by asset managers if they are associated with approved training or educational programs. Previously, third-party providers could pay for meals up to $300 per employee, per event, for a cumulative total not to exceed $1,000.
Asset managers cannot pay for entertainment for Merrill Lynch clients.
“These changes further ensure business interactions with third parties continue to be in the best interest of our clients,” the firm said in a statement.
The policy shift, effective immediately, also comes as the regulators and consumer advocates push for greater disclosure and mitigation of conflicts of interest in wealth and asset management. The SEC’s Regulation Best Interest, which updated advisor and broker standards of conduct, went into effect June 30.
News of Merrill’s policy shift was first reported byCityWire.