Merrill Lynch Settlement: $39M Deal Wraps Up Merrill Edge Retirement Accounts Lawsuit

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Merrill Lynch, Pierce, Fenner & Smith Incorporated has agreed to a $39 million class action settlement to resolve a lawsuit that alleged the wealth management and retail brokerage arm of Bank of America failed to pay a reasonable interest rate on cash balances in customers’ Merrill Edge self-directed retirement accounts that were “swept” into deposit accounts at Merrill-affiliated banks through its Retirement Asset Savings Program (RASP). 

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The Merrill Lynch class action settlement received preliminary approval from the court on October 7, 2026. Eligible for the settlement are all persons (including individuals, corporations, estates and trusts) who had one or more Merrill Edge retirement accounts with cash balances that were swept pursuant to RASP at any time from December 15, 2016 through March 15, 2020. 

Class members must have held a Merrill Edge Self-Directed Investing retirement account—e.g., an individual retirement account (IRA), Roth IRA, Rollover IRA, Inherited IRA, Simplified Employee Pension (SEP) IRA, or Savings Incentive Match Plan for Employees (SIMPLE) IRA—during the relevant time period. 

The court-approved website for the Merrill Lynch Merrill Edge settlement can be found at MLRetirementAccountLitigation.com. 

Class members do not need to file a claim form to receive a pro rata (proportional) share of the $39 million settlement fund after certain fees, expenses, taxes and awards are paid. 

The amount of each class member’s settlement payout will be based on the approximate amount of interest each person would have earned if, per the plaintiff’s allegations, Merrill’s RASP paid a reasonable rate of interest. Settlement payments under $10 will not be issued.

Settlement payouts will be deposited directly into each class member’s Merrill Edge retirement account, if it is still active. Class members who no longer maintain a Merrill Edge account are encouraged to elect to receive their settlement payout via electronic transfer; otherwise, they will receive a check. 

Class members can head to this page and enter the unique ID and PIN found on their copy of the settlement notice to opt for an electronic transfer. Class members have until March 26, 2027 to choose whether to receive their settlement payout via electronic transfer. 

The court will decide whether to grant final approval to the Merrill Lynch settlement following a hearing on March 12, 2027. Settlement money will begin to be distributed after the deal receives final approval and any appeals have been resolved. 

The lawsuit against Merrill Lynch, Pierce, Fenner & Smith Incorporated alleged that the Bank of America subsidiary breached the Merrill Edge Self-Directed Investing Client Relationship Agreement between Merrill and its customers by automatically “sweeping” cash balances in Merrill Edge retirement accounts into deposit accounts that paid less than a “reasonable rate” of interest, damaging class members financially as a result. 

Did you know that some class action settlements require no proof to submit a claim? Check out the latest open class action settlements.