Merrill Lynch Fined $225,000 Over Complaint Reporting Failures

Merrill Lynch agreed to pay a $225,000 fine after FINRA said it failed to report thousands of customer complaints found in call center survey responses. The settlement also includes a censure. The case centers on whether the firm properly handled written comments from customers who called its service lines between January 2018 and December 2023.

$225,000 on Merrill Lynch

$225,000 is the price FINRA set for the lapse, and the firm accepted a censure as part of the settlement. Merrill Lynch, Pierce, Fenner & Smith Incorporated invited callers to complete post-call surveys with a written commentary section during the period at issue, then did not reasonably review those responses for complaints. That left thousands of complaints outside the firm’s FINRA reporting process.

Thousands of complaints matter here because FINRA Rule 4530(d) requires quarterly summary and statistical customer complaint reporting. Merrill Lynch was also found to have failed to reasonably supervise its own process to meet that obligation, which ties the penalty to controls rather than a one-off filing error. The violations cited in the settlement were FINRA Rules 4530(d), 3110(a) and (b), and 2010.

Call center surveys, January 2018

January 2018 through December 2023 marks the full span of the reporting breakdown. During those six years, the firm kept asking customers who phoned its call centers to fill out surveys, including written comments, but did not reasonably review the text for complaint language. The result was not a missed customer note in isolation; it was a reporting failure that covered thousands of complaints.

FINRA’s action lands on the operational weak point in the process: if written survey responses can contain customer complaints, they have to be screened with enough care to capture what must be reported. Merrill Lynch’s settlement shows the regulator treated that failure as a supervision issue, not just a paperwork delay.

FINRA Rule 4530(d)

FINRA Rule 4530(d) sits at the center of the case because it governs the quarterly summary and statistical complaint reporting that firms must provide. Merrill Lynch’s failure to report thousands of customer complaints from survey responses meant those complaints never reached the reporting stream the rule requires. For customers, the practical takeaway is straightforward: written comments sent after a call are not just feedback if they describe a complaint the firm is required to capture and report.

The firm agreed to the $225,000 fine and censure after the conduct was identified. That leaves the record clear on what happened: a long-running review gap, thousands of unreported complaints, and a regulatory penalty tied to the firm’s internal supervision of its call-center survey process.