An attorney representing black financial advisers who filed a class action lawsuit against Bank of America’s Merrill Lynch unit in 2005 told Bloomberg that the bank has agreed to settle the discrimination suit.
Under the settlement, up to 1,200 class representatives could receive part of a $160 million payment from Bank of America. A judge will review the proposed settlement early next month. A spokesperson for the bank confirmed that a settlement had been agreed to and that Bank of America was “committed to enhancing opportunities for African-American financial advisers.”
The suit was filed by George McReynolds, who alleged that Merrill Lynch failed to provide equal business opportunities and account distribution to black financial advisers compared to white advisers. Reynolds remains employed with Merrill Lynch.
An appeals court granted the case class action status in the wake of a 2011 U.S. Supreme Court ruling in a discrimination case involving female workers at Walmart.
Merrill Lynch was acquired by Bank of America in 2009 for $33 billion. The firm employs about 14,000 financial advisers. Last year, Bank of America agreed to paid $2.43 billion to settle a class action lawsuit from investors who claimed that the bank misrepresented the financial condition of Merrill Lynch during the acquisition.
Shares of Bank of America dipped fractionally in Wednesday morning trading.