Merrill Lynch & Co. on Friday became the latest Wall Street firm to disclose employee wrongdoing, saying it fired two junk bond traders for mishandling a customer account.
The nation's biggest brokerage said the traders were fired Sept. 3. The firm said it conducted an internal investigation and filed a report on the incident with the New York Stock Exchange.
A Merrill executive who asked not to be named said the firm said in the NYSE report that the traders were dismissed because they removed a trade from a client's account and placed it in their own accounts without approval.
It was not clear how much money was involved in the transaction, which violated Merrill rules.
The traders were identified as Edward Scherer and Richard Kursman, vice presidents in Merrill's high-yield bond sales and trading department. Scherer joined Merrill in July, 1990, and Kursman in February, 1990, Merrill spokesman Fred Yager said.
Yager said Merrill had determined that the incident was isolated. The spokesman said Scherer and Kursman were not high-ranking executives in the department.
The disclosure comes in a climate of heightened concern on Wall Street about wrongdoing, since Salomon Inc. last month disclosed widespread violations in its government bond operations.
The Salomon scandal has resulted in the resignations of top executives at that firm and federal criminal and civil investigations of wrongdoing throughout the government bond market.
Last week, Shearson Lehman Bros. Inc. suspended the head of its worldwide stock department and a top assistant amid an investigation into whether they manipulated a stock to improve the status of a public offering.
UBS Securities Inc., a subsidiary of United Bank of Switzerland, on Monday said it fired one senior executive and suspended another for allegedly making false trades to increase the distribution of a securities underwriting.