Merrill settlement proposal drafted, report says
Reuters News Agency
Merrill Lynch & Co. has put together a formal proposal it hopes will convince New York Attorney General Eliot Spitzer not to bring forward criminal charges that could cripple the investment bank, the Wall Street Journal said in its on-line edition on Thursday.
Merrill Lynch, which has been accused of issuing biased and overly bullish stock research, is hurrying to reach a settlement to prevent a court hearing that would involve testimony from company executives.
The proposal, according to unnamed sources cited by the Wall Street Journal, would call for an ombudsman and a separate committee that would monitor Merrill's research, as well as the payment of a fine of tens of millions of dollars and the expression of some contrition.
Merrill Lynch planned to present the proposal ahead of the weekend to Spitzer's office, the article said. A court hearing on the matter had initially been scheduled for Thursday, but it was moved earlier this week to May 16 because of what Merrill said were "productive discussions" between the parties.
A spokesman for the investment bank did not immediately return a phone call for comment.
As part of the proposal, Merrill would also try to get other Wall Street firms to make similar commitments in a move to pump up confidence in their research, the Journal's sources said.
Investors who lost money on stocks that were recommended by Merrill analysts, though, would be left to press forward with civil litigation.
Merrill Lynch shares closed $1.04 (U.S.) lower, down more than 2 per cent, at $42.91 on the New York Stock Exchange on Thursday. |
