BofA to pay $160M to settle racial bias case

Suit on behalf of 1,200 black brokers claimed discrimination in business opportunities

Dec 6, 2013 @ 1:05 pm

By Trevor Hunnicutt

A judge has approved a plan by Bank of America Corp. to pay $160 million to settle a discrimination suit filed by African-American brokers and trainees.

U.S. District Court Judge Robert W. Gettleman made the settlement final in a hearing Friday at the U.S. District Court for the Northern District of Illinois in Chicago, according to Princess Acres, assistant to a lawyer for the plaintiffs at Stowell & Friedman LTD.

The settlement is the largest since Coca-Cola Co. paid $192.5 million in 2001 and Texaco Inc. paid $176 million in 1997 to settle similar suits, according to data compiled by Bloomberg News.

Bank of America has hailed the settlement and said it would enhance opportunities for African-American advisers, who historically have been hired in small numbers at Wall Street firms, including the Merrill Lynch brokerage it purchased in 2009.

The case, filed in 2005, was brought on behalf of one employee and grew to represent as many as 1,200 class members. Merrill Lynch employed 15,624 advisers as of Sept. 30.

The central claim of the suit was that black brokers weren't given the same business opportunities as whites in participating on investment teams and in account distribution.

Mr. Gettleman rejected the case as a class action three times before a federal appeals court approved it.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

Events

2019 concerns keeping successful advisory firm leaders up at night

These are the greatest business challenges for next year, according to InvestmentNews' Best Practices honorees.

Latest news & opinion

Some good news about female recruitment in financial advice

Each of four core advisory positions tracked in InvestmentNews' benchmarking study has seen an uptick in women entrants.

10 ETFs that are up more than 35% this year

Amid the stock market carnage, there are still some funds posting big gains.

10 biggest HSA providers rated

Morningstar rated the largest plan providers as investment and spending vehicles.

Morningstar: DOL fiduciary rule reduces inflows to mutual funds with high loads

With the measure's demise, will the SEC's advice reform sustain the momentum?

6 tax strategies for year-end planning

How to help clients maximize their wealth using specific tax strategies before the end of the year.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print