Black Brokers' Suit against Merrill Dismissed

A bias lawsuit by black financial advisers accusing Merrill Lynch of discrimination has been thrown out.

The decision by U.S. District Judge Robert Gettleman of the U.S. District Court for the Northern District of Illinois is the latest setback for the brokers, Reuters is reporting. The plaintiffs claimed they were discriminated against regarding retention bonuses after Bank of American bought Merrill Lynch; they had first accused Merrill in a related case in 2005 of systematic discrimination in hiring, pay and promotions.

Reuters said Merrill had employed more than 15,000 brokers before Bank of America bought the company on January 1, 2009, creating the largest U.S. bank by assets.

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The black advisers had complained that their bonuses were based on “production,” or fees earned on client assets. They said this caused them to be grossly underrepresented in top quintiles and overrepresented in bottom quintiles because of Merrill’s earlier discrimination, including its alleged steering of lucrative accounts to white brokers.

However, Gettleman said there was no showing that Bank of America designed its bonus program with intent to discriminate. “Knowledge of past and even present discrimination alone does not make it plausible that defendants actually adopted the adviser transition program with discriminatory intent,” the judge wrote.

The case is McReynolds et al. vs. Merrill Lynch & Co. et al., U.S. District Court, Northern District of Illinois, No. 08-06105.

Former Fidelity Exec to Head AllianceBernstein DCIO Sales Team

AllianceBernstein has announced that Craig Lombardi has joined the firm as Managing Director—Defined Contribution Investment-Only (DCIO) Sales. 

In this role, Lombardi will be responsible for leading the firm’s DCIO sales team, which covers intermediaries such as financial advisors and consultants, and works with regional salespeople from the retirement platforms where AllianceBernstein funds are included.

“Craig’s experience in sales management and his knowledge of the DC market make him well positioned to bring the distribution of our DC products and services in the intermediary space to the next level,” said Joel R. Stevens II, Senior Managing Director—Americas, AllianceBernstein Institutional Investments, in a press release.

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Lombardi is a 20-year veteran of Fidelity Investments Institutional Services, Inc., where he served as national sales manager of the Institutional Insurance Platform Variable Annuity and DC sales teams, among other roles.

“Because the DC business continues to be a priority for the firm, we are bolstering our resources in this area. We continue to experience growth in both our assets under management and the range of products we offer,” says Thomas J. Fontaine, Head of AllianceBernstein Defined Contribution Investments. 

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