BATON ROUGE, June 20, 2026, 09:04 CDT
- Merrill Lynch is paying a $175,000 fine to FINRA after issues with municipal-bond disclosures. This comes just days after the company got a separate $225,000 censure for not reporting some call-center complaints.
- Bank of America is pushing into Baton Rouge while it faces compliance issues that may cast a shadow over its retail-banking rollout in Louisiana.
- The question isn’t how big the fines are. It’s if a big bank can still keep brokerage controls strong as a growing number of clients move to digital and self-directed options.
Merrill Lynch, part of Bank of America, got hit with a $175,000 fine from the Financial Industry Regulatory Authority for missing municipal-bond disclosures. This is the second fine for Merrill reported this month. Bank of America is also moving ahead with plans to open its first Baton Rouge branch.
Timing is a factor. Bank of America is putting more resources into Louisiana, pointing to New Orleans and Baton Rouge as its local focus. It’s expecting to open its first New Orleans financial center in 2027. The Advocate said the bank will open its first Baton Rouge branch as well.
The fine itself barely dents a bank worth more than $400 billion. But the enforcement actions raise a broader issue—whether Merrill’s systems are up to the task of spotting customer complaints and handling tax-sensitive bond disclosures as more clients interact through call centers, apps or brokerage platforms instead of going to an adviser.
FINRA said Merrill didn’t inform self-directed clients about non-de minimis market discounts on 4,181 muni bond buys between January 2021 and September 2023. These trades had a total principal value of around $87 million, spread across 1,072 accounts. A market discount can occur when a muni bond trades below redemption value, and the Municipal Securities Rulemaking Board says that kind of discount could be taxed as ordinary income and has to be disclosed if material, either at or before the trade.
Merrill gave market-discount disclosures to impacted self-directed customers and offered to pay compensation if they could show tax liability higher than the capital-gains rate, the FINRA settlement said. The firm updated its written procedures in September 2023 and included a market-discount disclosure in self-directed trades where required.
Merrill Lynch’s earlier $225,000 case was tied to customer complaints. From 2018 to 2023, Merrill had callers fill out post-call surveys that included a free-form comment box, but their review system overlooked over 1,600 complaints that should have been flagged, according to AdvisorHub and the FINRA settlement. Merrill got more than 220,000 written survey responses in 2023, reported about 2,400 of those as complaints, but missed the rest due to a programming issue in its oversight system, AdvisorHub said.
Merrill missed reporting mostly routine service complaints, but some were about issues like getting to funds, accessing account info, documents, online problems, and security. The firm settled without admitting or denying the findings. A spokesperson had no comment. FINRA credited Merrill for self-reporting, for looking at 2023 survey responses, fixing complaints, and for suspending the post-call survey written comment section in January 2024.
Merrill’s problem is supervision. In one case, its system missed written client complaints. In another, Merrill’s procedures didn’t guarantee customers knew about a tax detail in self-directed muni-bond trades. Both failures happened in the back office, not on the trading side. That carries weight for a firm pushing to bundle banking, brokerage, and advice in a single shop.
Bank of America sees its branch expansion as a “high tech and high touch” push, according to CEO Brian Moynihan in a 2023 update. Aron Levine, who runs preferred banking, said customers keep coming into branches for “more complex financial needs,” while they go online for the basics. Bank of America
Bank of America’s Jonathan Matessino, who heads up the New Orleans and Baton Rouge markets, says on the company’s local page that “New Orleans and Baton Rouge are special.” He says the goal is to connect the bank’s global resources with the local area. That is the message to clients. But now the regulatory record comes with the pitch. About Bank of America
Bank of America isn’t the only big lender still opening branches. JPMorgan Chase is going for more than 500 new locations by 2027. Bank of America is aiming for 165 new branches by the end of 2026. According to Banking Dive, both JPMorgan Chase and Wells Fargo have bigger U.S. branch networks than Bank of America, so branch presence is still a real point of competition among the largest banks.
Bank of America’s main risk isn’t the fines themselves. Instead, repeated findings by supervisors can prompt more scrutiny from regulators and customers, especially as complaints, account access problems, cybersecurity and tax disclosures affect retail clients. Merrill did not admit or deny FINRA’s findings in these settlements, according to .
Bank of America shares were last at $56.20, putting its market cap around $416.9 billion. U.S. markets didn’t trade Saturday. The fines aren’t big next to that number, but they matter. A Baton Rouge branch puts up a new sign for a new customer, but the systems running it are the old ones.
