According to a Salomon Smith Barney producer, the firm issued an internal memo to all brokers and employees today, saying it is going to change its research practices in the aftermath of Merrill Lynch’s $100 million settlement with the New York Attorney General.
“Good timing, huh,” the producer tells Registered Rep. “Naturally, we knew it was coming. Everyone knew, especially since a lot of people feel Merrill got off so easily with a $100 million fine. Just as we’re speaking, I bet other wire houses are doing the same thing.”
Telephone calls made to brokers at Morgan Stanley and UBS PaineWebber revealed that those firms have yet to issue a memo or make an announcement regarding plans to alter research practices.
Mirroring Merrill Lynch’s decision to make research changes, Smith Barney plans to separate analyst evaluation and compensation from investment banking, and to establish a research review committee, according to the memo, a producer says.