SEC Alleges Wells Fargo and Merrill Lynch Cash Sweep Accounts Shortchanged Customers

In a significant development for the financial industry, the U.S. Securities and Exchange Commission (SEC) has filed allegations against Wells Fargo and Merrill Lynch over their cash sweep account practices, claiming that these financial institutions have shortchanged their customers. The allegations stem from a review of how customer funds are managed within cash sweep accounts, which are designed to maximize returns on uninvested cash by directing it into interest-bearing money market funds.

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