Wells, Merrill Sweep Accounts Shortchanged Clients, SEC Says (1)

Investment adviser units of Wells Fargo & Co. and Bank of America Corp.’s Merrill shortchanged customers by funneling uninvested cash into sweep accounts that benefited the banks but not their clients, the US Securities and Exchange Commission alleged Friday.

The firms paid $60 million to settle the claims without admitting to or denying the regulator’s allegations.

Wells Fargo Clearing Services agreed to pay a civil penalty of $28 million; Wells Fargo Advisors Financial Network, $7 million; and Merrill, $25 million, according to the SEC’s cease-and-desist orders.

Wealth advisers direct clients into so-called cash sweep accounts before customers make ...