KT Law Represents Former Merrill Broker in $3.2M Deferred Compensation Claim for ERISA Violations

Rhea-AI Summary

National investment loss and securities attorneys KlaymanToskes announced a FINRA arbitration claim against Merrill Lynch, a division of Bank of America (NYSE: BAC), on behalf of a former financial advisor seeking to recover over $3.2 million in deferred compensation damages. The claim alleges that Merrill Lynch's 'Cancellation Rule,' which requires a vesting period of five to eight years, violated the Employee Retirement Income Security Act's (ERISA) anti-forfeiture provisions, resulting in withheld compensation. KlaymanToskes encourages other former Merrill advisors with similar losses exceeding $100,000 to explore their legal options.

Positive

• KlaymanToskes' ongoing efforts to recover $3.2 million in deferred compensation for a former Merrill financial advisor.
• Potential higher recovery rates through FINRA arbitration compared to class action lawsuits.
• KlaymanToskes has a strong track record, having recovered over $250 million in FINRA arbitrations and $350 million in other securities litigation.

Negative

• Merrill Lynch's 'Cancellation Rule' may have breached ERISA's anti-forfeiture provisions, leading to potential legal liabilities.
• Deferred compensation plan disputes may result in significant financial outlays for Merrill Lynch.
• Class action lawsuits and arbitration claims could damage Merrill Lynch's reputation and investor confidence.

All Merrill Brokers Who Have Losses Over $100,000 Should Immediately Contact the Law Firm of KlaymanToskes

NEW YORK, NY / ACCESSWIRE / June 10, 2024 / National investment loss and securities attorneys KlaymanToskes announces that the law firm has filed a FINRA arbitration claim against Merrill Lynch, a division of Bank of America (NYSE:BAC), on behalf of a former financial advisor who has lost over $3.2 million in deferred compensation damages. All former Merrill brokers/advisors who have suffered deferred compensation damages in excess of $100,000 are encouraged to explore all their legal options and to contact KlaymanToskes immediately at 888-997-9956.

KlaymanToskes reports that the law firm is pursuing multiple claims against Merrill in deferred compensation disputes, and has filed a FINRA arbitration claim (no. 24-01224) on behalf of a former Merrill advisor who is seeking to recover over $3,200,000 in deferred compensation damages. According to the lawsuit, when the advisor left Merrill, the firm invoked its "Cancellation Rule," which required a vesting period of five to eight years as part of its deferred compensation plans. As a result, Merrill Lynch withheld the broker's deferred compensation that was valued at just under $1.7 million, which today would be worth over $3.2 million.

The lawsuit follows a recent class action complaint (No. 3:24-cv-00440) which alleges that Merrill's deferred compensation plan for employees qualifies as an employee benefit plan governed by the Employee Retirement Income Security Act of 1974, and is therefore subject to its anti-forfeiture provisions. Financial Professionals should know that class-actions may take many years to resolve, and that payouts are generally heavily undervalued. KlaymanToskes previously conducted a detailed study of securities arbitration versus class action and concluded that Financial Industry Regulatory Authority (FINRA) arbitration claims traditionally obtain an overall higher rate of recovery as opposed to participating in a class action lawsuit.

Merrill offers two deferred compensation plans for its financial advisors: the Short Term Deferral Plan and the WealthChoice Plan. Under the Short Term Deferral Plan, advisors receive a commission percentage based on the assets they bring with them to the firm, with 50% of these awards invested in the plan and vesting over five years. The WealthChoice Plan automatically allocates a portion of a financial advisor's commissions into the plan, which vests over eight years.

Merrill withholds financial advisors' deferred compensation plans if the advisor leaves before the vesting date. This is called the Merrill "Cancellation Rule." KlaymanToskes' investigation has determined that Merrill's "Cancellation Rule" violated ERISA's vesting and anti-forfeiture requirements. Therefore, Merrill wrongfully denied the advisor deferred compensation which was earned and would have since appreciated significantly.

If you are a former Merrill financial advisor or other securities industry professional facing an employment dispute, contact attorney Lawrence L. Klayman at (888) 997-9956 or by email at investigations@klaymantoskes.com in furtherance of our investigation.

About KlaymanToskes

KlaymanToskes is a leading national securities law firm co-founded by former securities broker Lawrence L. Klayman, which practices exclusively in the field of securities arbitration and litigation on behalf of both investors and financial industry professionals throughout the world in large and complex securities matters. The firm has recovered over $250 million in FINRA arbitrations and over $350 million in other securities litigation matters. KlaymanToskes has office locations in California, Florida, New York, and Puerto Rico.

Contact

Lawrence L. Klayman, Esq.
KlaymanToskes, P.A.
+1 888-997-9956
investigations@klaymantoskes.com

SOURCE: KlaymanToskes, P.A.

View the original press release on accesswire.com

FAQ

What is the recent claim filed against Merrill Lynch (BAC)?

KlaymanToskes filed a FINRA arbitration claim against Merrill Lynch on behalf of a former advisor seeking $3.2 million in deferred compensation damages.

Why is Merrill Lynch (BAC) being sued for deferred compensation?

Merrill Lynch is being sued for allegedly violating ERISA's anti-forfeiture provisions by withholding deferred compensation from a former advisor.

What should former Merrill brokers do if they have significant deferred compensation losses?

Former Merrill brokers with deferred compensation losses over $100,000 should contact KlaymanToskes to explore their legal options.

What is Merrill Lynch's 'Cancellation Rule'?

Merrill Lynch's 'Cancellation Rule' requires a vesting period of five to eight years for deferred compensation plans, and withholds funds if the advisor leaves before vesting.

How does KlaymanToskes' track record benefit investors?

KlaymanToskes has recovered over $250 million in FINRA arbitrations and $350 million in other securities litigation, suggesting a strong capability in achieving favorable outcomes.