Feeds

Merrill Lynch to cough $2.5m for missing emails

SEC action settled

Build a business case: developing custom apps

Merrill Lynch and the US Securities and Exchange Commission have settled proceedings brought over a failure by the company to promptly produce emails requested by SEC staff. The brokerage firm will pay $2.5m.

The proceedings related to “various investigations and inquiries” being carried out by SEC staff into Merrill Lynch between October 2003 and February 2005. In the course of this, according to the SEC, it had asked the firm to provide certain emails dealing with its business as a broker, dealer and member of an exchange.

US regulatory rules require that securities and investment firms have adequate systems, procedures and policies in place to promptly produce evidence, including emails, requested in the course of an investigation. Communications relating to its business must be kept for three years.

However, according to the SEC, on numerous occasions Merrill Lynch was unable to furnish the requested emails promptly. On one occasion it took around seven months to produce the emails, on another around five months. The regulator found that Merrill Lynch had wilfully breached the Securities and Exchange Act 1934, and Rules relating to it.

The action has now settled, with the firm, which has not admitted any wrongdoing, undertaking to review its systems, procedures and policies in connection with email retention and to appoint a consultant to advise on the review.

The SEC has censured Merrill Lynch and imposed a penalty of $2.5m. Merrill Lynch spokesman Mark Herr told Reuters that the firm has improved its systems and now believes it is able to promptly provide any further requested emails.

The SEC Order (7-pages / 57KB PDF)

Copyright © 2006, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

Gartner critical capabilities for enterprise endpoint backup

More from The Register

next story
Kate Bush: Don't make me HAVE CONTACT with your iPHONE
Can't face sea of wobbling fondle implements. What happened to lighters, eh?
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Online tat bazaar eBay coughs to YET ANOTHER outage
Web-based flea market struck dumb by size and scale of fail
Amazon takes swipe at PayPal, Square with card reader for mobes
Etailer plans to undercut rivals with low transaction fee offer
Assange™: Hey world, I'M STILL HERE, ignore that Snowden guy
Press conference: ME ME ME ME ME ME ME (cont'd pg 94)
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
US regulators OK sale of IBM's x86 server biz to Lenovo
Now all that remains is for gov't offices to ban the boxes
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.