Parker Waichman LLP

SEC Launches Probe Of Analysts

  The SEC Launches Probe Of Analysts. The Securities and Exchange Commission is launching a formal inquiry into potential conflicts of interest between stock analysts and investment banks, the regulatory agency announced Thursday. The SEC investigation will examine if securities firms such as Merrill Lynch & Co.’s and others had analysts issue favorable research on […]

 

The SEC Launches Probe Of Analysts. The Securities and Exchange Commission is launching a formal inquiry into potential conflicts of interest between stock analysts and investment banks, the regulatory agency announced Thursday.

The SEC investigation will examine if securities firms such as Merrill Lynch & Co.’s and others had analysts issue favorable research on stocks that the investment side of the firms were currently working with or attempting to work with as clients.

At issue is whether recommendations of certain stocks were unduly affected by a given company’s investment banking business.

“This is the next step and a critical one in the commission’s yearlong review of analyst practices,” said SEC Chairman Harvey Pitt.

relationship between its investment bankers and equity analysts

The SEC’s announcement comes in the wake of a recent court order from the state of New York requiring that the financial services company disclose the relationship between its investment bankers and equity analysts, which resulted from a 10-month investigation of Merrill Lynch by New York Attorney General Elliot Spitzer.

Spitzer met Wednesday with Pitt to discuss potential fraud by Wall Street’s investment banks.

The investigation looked at more than thousands of company documents and e-mail, which had been subpoenaed from Merrill Lynch analysts.

The inquiry will be conducted by the SEC, the New York Stock Exchange, the National Association of Securities Dealers, Spitzer, the North American Securities Administrators Association and several states, according to a statement released by the SEC and Spitzer.

“This was a shocking betrayal of trust by one of Wall Street’s most trusted names,” Spitzer said. “The case must be a catalyst for reform throughout the entire industry.”

In particular, New York’s attorney general has raised questions about the relationship between Merrill’s high-profile Internet and dot-com analyst Henry Blodget and the Merrill’s banking business. The court order, signed by state Supreme Court Justice Martin Schoenfeld, takes effect Thursday.

According to Merrill Lynch, there is “no basis for the allegations” and “a fair review of the facts will show that Merrill Lynch has conducted its research with independence and integrity.”

“We have been a leader in practices to assure the independence of our highly regarded research group,” the New York-based company said in a statement. “The allegations reveal a fundamental lack of understanding of how securities research works within the overall capital raising process.”

“They cite a limited number of employee e-mail, taken out of context, as ‘proof’ that investment banking had undue influence in determining research ratings. In fact, these e-mails prove nothing of the sort,” the company added.

Need Legal Help Regarding Probe Of Analysts?

The personal injury attorneys at Parker Waichman LLP offer free, no-obligation case evaluations. For more information, fill out our online contact form or call 1-800-YOURLAWYER (1-800-968-7529).

What Our Clients Say About Us
We have worked with thousands of clients and we appreciate them and their positive reviews. Here are just a few recent client reviews...
5 Star Reviews 150
They got right on my case. Wasted no time and fought/won the decision to continue with my therapy after the insurance company wanted to terminate it. Even the insurance company knew from my medical records that I needed to continue. My nurse Ms. Joanne Stevens is very concerned about my condition and treatment and assured that I would continue. I am very familiar with this law firm. They are like human pitbulls when they latch onto a wrong door. Humph!!! I'm glad they're on my side.
JANICE Peters-Rowe
5 years ago
5 Star Reviews 150
Parker Waichman LLP has provided outstanding client service. Working with Christina Morace made the process seamless. She was diligent, timely, and proficient. She always kept me abreast of my case. I am thankful for their service and highly recommend the firm to my friends and family for their outstanding, speedy, and courteous service. Edith J. Barrow
Charmaine Gray
3 years ago
5 Star Reviews 150
Good for the body of lawyers and all the staff, very good team, also congratulate Jorge Peniche for his excellent work, and his way of treating people, very good person.
Carlos Olmedo
5 years ago

Why Choose Us to Help You?

We Take Care of Everything
Your situation is stressful enough: Let us take on the deadlines, paperwork, investigation, and litigation. We'll handle every detail so you don't have to worry.
No Recovery = No Legal Fees
We work on a contingency-fee basis, meaning that we only get paid from a portion of your settlement or jury award. If you don't get compensation, you owe us nothing.
Decades of Experience
Your situation is stressful enough: Let us take on the deadlines, paperwork, investigation, and litigation. We'll handle every detail so you don't have to worry.
Respected by Our Peers
Judges, insurance adjusters, and fellow attorneys all speak highly of our skills, and we've earned numerous accolades, including a flawless rating from AVVO.
We Have Many Locations To Serve You
We have the experience and the skilled litigators to win your case. Contact us and speak with a real attorney who can help you.
Long Island – Nassau
Parker Waichman LLP
6 Harbor Park Drive
Port Washington, NY 11050
Long Island – Suffolk
Parker Waichman LLP
201 Old Country Road – Suite 145
Melville, NY 11747
New York
Parker Waichman LLP
59 Maiden Lane, 6th Floor
New York, NY 10038
Queens
Parker Waichman LLP
118-35 Queens Boulevard, Suite 400
Forest Hills, NY 11375
Brooklyn
Parker Waichman LLP
300 Cadman Plaza West
One Pierrepont Plaza, 12th Floor
Brooklyn, NY 11201
New Jersey
Parker Waichman LLP
80 Main Street, Suite 265
West Orange, NJ 07052
Florida
Parker Waichman LLP
27299 Riverview Center Boulevard
Suite 108
Bonita Springs, FL 34134
Nationwide Service
Parker Waichman LLP
59 Maiden Lane, 6th Floor
New York, NY 10038