Thread regarding Bank of America layoffs

Merrill Lynch Prevents Clients, Advisors From Trading Cryptocurrency

Wealth management firm Merrill Lynch has blocked all of its clients and financial advisers who manage money for clients from trading Bitcoin over fears of instability relating to the cryptocurrency, the Wall Street Journal reported.

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Yep, crypto-currencies are going to make banks obsolete! Kill it now!!!!

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None of your pay-to-view links refute the standard ML policy. All it shows that ML settled for peanuts for possible lapses in due diligence. When the banks were repaying billions from the crisis - don't think they cared to argue too much over chump change.

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Here are more articles which I didn't bother to read but prove you wrong once again.

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Feel free to give us a summary.

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Try reading the articles you post, and not just the headline link from your google searches. It's called comprehension. We had this before ADHD.

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Sorry. Didn't know I was supposed to look for an article with a policy that didn't make you incorrect.

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The second link was ex-executive money and not client money. The first article clearly states ML policy from the late 90s.

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Merrill Lynch, the parent company, had opportunities to invest with Madoff's firm over the years but concluded that its structure "lent itself to fraud and manipulation without adequate independent checks, that Madoff’s returns were not generated by the claimed trading strategy, and that Madoff’s investment advisory business might very well be fraudulent," the suit says.

What kind of structure was Merrill referring to? Well, the fact that Madoff served as the investment advisor, the prime broker and the custodian of assets all at the same time. In other words, Madoff wasn't transparent and that made Merrill wary enough to keep BLMIS off its platform.

For some time, Merrill Lynch didn't invest its own money or clients' money through BLMIS, and it even refused to provide leverage for other investors looking to make investment in Madoff feeder funds. It prohibited executing trades with exposure to Madoff around the late 1990s and at the behest of upper-level executives including a former senior executive of Merrill Lynch Investment Management, Fabio Savoldelli.

Savoldelli, and others within the global MLCI organization, easily spotted numerous red flags indicative of irregular or fictitious lending activities in Madoff’s operations, including: (i) impossibly consistent returns with no down years ever; (ii) Madoff’s total equity portfolio liquidation at every quarter and year end; (iii) audits of BLMIS by a small, strip mall accountant and tax preparer; (iv) Madoff’s purported trading with unidentified options counterparties; and (v) the lack of, and defects in, independent checks and balances – i.e., lack of internal controls as to the existence of actual assets where Madoff served as the advisor, the broker and the custodian of the assets. In addition, Madoff’s “commission” structure, whereby he left hundred of millions if not billions of dollars in performance and management fees on the table for others, such as the feeder funds, reminded Savoldelli of other Ponzi schemes.

It wasn't just the parent company's refusal expose itself to Madoff, MLI itself refused trades involving Madoff, the suit reveals. When in December 2006, a London-based MLI group was asked to consider a leveraged transaction involving a Madoff feeder fund. A desk employee responded with the following:

The fund is managed by Bernie Madoff, and the brokerage firm behind the fund is Madoff securities. Madoff is known for keeping the source of his returns a secret. This caused a lot of speculation on Wall Street about the true source of the admittedly impressive returns. Merrill Lynch has repeatedly looked into Fairfield Sentry and other Madoff funds, which all use the same strategy called ‘split strike conversion.’ The decision was taken some time ago that Merrill Lynch does not offer any products on these funds.

Merrill appears to be acting diligently in its refusal to support Madoff-related activity. But somehow one of its divisions ended up selling products tied to funds that were funneling billions to Madoff. It's unclear if Merrill or any financial institution knew how much exposure feeder funds like Fairfield Greenwich Group had to BLMIS.

Here's the bottom line on the Merrill case: the firm kept Madoff off its platform because there wasn't enough transparency to make it worth it. Regardless, Merrill still decided to sell products ($56 million worth) tied to funds that, in essence, helped kept Madoff afloat.

Madoff has claimed recently that everyone knew his returns were too good to be true. So, is Madoff right? Is Merrill just another bank turning a blind eye to blatant fraud?

I have my reservations on this one. If for no other reason that Merrill is being asked to repay just $16 million.

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Really?

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Standard ML practice. They also refused to do business with Bernie Madoff...

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