Merrill Lynch to Pay More than $8 Million in SEC Probe of Prereleased ADRs

   By Bowdeya Tweh

A Bank of America Corp. unit has agreed to pay more than $8 million to settle federal charges that it improperly handled prereleased American Depositary Receipts, the Securities and Exchange Commission said Friday.

The settlement with Merrill Lynch is the ninth enforcement action the SEC has obtained in what it described as an ongoing investigation.

JPMorgan Chase & Co., Deutsche Bank AG, Bank of New York Mellon Corp. and Citigroup Inc. are among banks that have reached settlements with the SEC in connection with the matter. The SEC said the probe has resulted in settlements totaling more than $370 million.

ADRs were created to help investors avoid complexities and costs of directly owning shares in foreign companies while at the same time widening the corporations' investor base in the U.S.

Without admitting guilt, Merrill agreed to pay more than $4.4 million in disgorgement, more than $724,000 in prejudgment interest and a $2.89 million penalty.

An attorney listed as representing Merrill couldn't immediately be reached for comment.

Merrill voluntarily stopped trading prerelease ADRs more than four years ago, a Bank of America representative said in a statement.

Write to Bowdeya Tweh at bowdeya.tweh@wsj.com

(END) Dow Jones Newswires

March 22, 2019 13:12 ET (17:12 GMT)

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