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Current and former clients who had a Merrill Edge retirement account with cash balances swept through the Retirement Asset Savings Program between Dec. 15, 2016, and March 15, 2020, may qualify to claim a cash award from a class action settlement.
Merrill Lynch, Pierce, Fenner & Smith Inc. agreed to pay $39 million to resolve a lawsuit alleging it failed to pay a reasonable rate of interest on cash balances in customers’ Merrill Edge self-directed retirement accounts that the company swept into deposit accounts at Merrill-affiliated banks.
Who are the class members?
Class members must meet all of the following criteria:
- They held one or more Merrill Edge self-directed retirement accounts at any time from Dec. 15, 2016, through March 15, 2020.
- Merrill Lynch swept their account(s) cash balances into deposit accounts through RASP during that period.
- Their account was a qualifying retirement account type, such as:
- Individual Retirement Account
- Roth IRA
- Rollover IRA
- Inherited IRA
- Simplified Employee Pension IRA
- Savings Incentive Match Plan for Employees IRA
If a class member had more than one qualifying account, the settlement considers each account individually for payment purposes. Those who closed their Merrill Edge retirement account are still eligible as long as they met the class criteria during the class period.
How much can class members get?
The amount each class member receives is based on the difference between the interest actually paid on their RASP cash balances and what the plaintiff alleged would have been a reasonable rate calculated monthly for each account and summed over the class period. Class members whose calculated share of the net settlement fund is $10 or more will receive a cash payment. Class members can view example calculations on the settlement website.
No action needed to receive compensation
Eligible class members do not need to file a claim to receive a cash payment. The settlement administrator already has the necessary account information to determine eligibility and payment amounts. Class members who wish to receive their payment via electronic transfer must submit an online electronic payment request.
Settlement administrator's mailing address: Valelly v. Merrill Lynch, c/o JND Legal Administration, P.O. Box 91219, Seattle, WA 98111
The deadline to select electronic transfer is March 26, 2027.
Required information
Class members submitting the online electronic payment request must provide the unique ID and PIN they received in their settlement notice.
Payout options
- Paper check mailed to the address on file
- Electronic transfer to class member's bank account
- Direct deposit to class member's active Merrill Edge retirement account
$39 million settlement fund breakdown
The $39,000,000 settlement fund includes:
- Settlement administration costs: Amount not specified
- Attorneys' fees: Up to $11,700,000
- Attorneys' expenses: Up to $2,100,000 plus interest
- Service award to class representative: Up to $15,000 plus interest
- Payments to eligible class members: Remainder of the fund
Important dates
- Deadline to opt out: Feb. 19, 2027
- Deadline to select electronic payment: March 26, 2027
- Fairness hearing: March 12, 2027
When is the Merrill Lynch payout date?
The settlement administrator will issue payments to eligible class members once the court resolves any appeals and grants final approval of the settlement.
Why is there a class action settlement?
The class action lawsuit alleged Merrill Lynch breached its client agreement by failing to pay a reasonable rate of interest on cash balances in Merrill Edge self-directed retirement accounts swept into RASP deposit accounts at Merrill-affiliated banks. The plaintiff claimed this caused financial harm to account holders.
Merrill Lynch denied all wrongdoing and liability but agreed to settle to avoid the cost and uncertainty of trial and appeals.
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