NASD Arbitration Panel Orders Merrill To Pay $192,000 to Ex-Client
An NASD arbitration panel today ordered the firm to pay a former client $192,000 for giving her "unsuitable'' advice.
Attorney Robert Uhl, a partner at Aidikoff & Uhl, a Beverly Hills, Calif., law firm that specializes in arbitration cases against securities firms, says he has "many" similar cases pending against Merrill that are in the process of being looked at by the NASD.
"I’m getting hundreds of calls every day," Uhl says.
The NASD panel found Merrill liable for breach of fiduciary trust and failure to supervise broker Robert Morgart of Sante Fe, New Mexico. The award to Patricia McNamara, 78, comes about a year after she and her daughter, Cynthia, 52, brought a claim against Morgart for advising them to invest in technology stocks that were too risky for them.
The McNamaras sought $2.4 million to recoup losses and pay fees. A Merrill spokesperson says the firm is pleased with the award, claiming the firm did not do anything wrong in the matter and that the award reflects it.
The NASD decision comes on the heels of an investigation by the New York State Attorney General, who found that Merrill gave favorable ratings to companies to attract and retain lucrative banking work from them. According to attorneys, Merrill stands to lose "billions" of dollars.
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