YOU ARE HERE: LAT HomeCollections


Spitzer Ready to Make Deal With Merrill

April 16, 2002|From Bloomberg News and Times Staff

New York state Atty. Gen. Eliot Spitzer said that he is willing to try to negotiate a settlement with brokerage Merrill Lynch & Co. over the conduct of the firm's stock analysts in recent years, and that splitting off research as a separate unit isn't necessarily a condition for a deal.

Spitzer's office last week filed an affidavit in state court alleging that Merrill's Internet stock analysts in 2000 and 2001 routinely touted stocks to the public even while privately disparaging them. The analysts were trying to curry favor with the firms in the hope of landing lucrative investment-banking business, the report alleges.

The probe of Merrill is the initial salvo in a broader investigation of Wall Street practices, Spitzer said. Even so, his office "would like to resolve the matter through negotiations," said Juanita Scarlett, a Spitzer spokeswoman.

Spitzer on Monday said he would no longer demand that Merrill split off investment research as a separate entity. But sources say Spitzer still wants Merrill to pay a fine and admit wrongdoing.

The two sides, and the Securities and Exchange Commission, are expected to discuss the case this week, sources said.

A Merrill spokesman declined to comment.

Merrill shares rose 62 cents to $47.51 on the New York Stock Exchange on Monday, after tumbling 13% last week.

Los Angeles Times Articles