According to a story posted yesterday on, a financial blog run by Henry Blodget and John Carney, founding editor of, Dan Sontag, head of Merrill Lynch’s global wealth and investment management unit, is about to be pink-slipped. What’s more, the story says the rapidly shrinking thundering herd of 16,000 brokers can expect soon to be salaried employees.

“That’s utterly not true,” says one of the firm’s top producing advisors, a member of the firm’s private banking investment group (PBIG) who claims to have access to top brass. A Merrill Lynch spokesperson also said the story was without merit.

Even if Sontag were to leave, says the broker, top producers wouldn’t be running for the exits. But pay them salary-plus-bonus, as the other half of the rumor suggests? Everyone would leave. “Can you imagine if they messed with compensation right now? A comp change like that would be the end,” he says.

Clusterstock has since posted an update of the story, including a quote from Merrill spokesperson, Selena Morris, saying the rumor is without merit. So what inspired the original story? The PBIG broker we spoke to has his own theory. “It smacks of a bitter U.S. Trust employee,” he says.

Why? He says what’s really in the works is that U.S. Trust—which includes a trust division and a wealth management division—is being dismantled. “It’s an unproductive organization without scale,” he says. There are roughly 800 U.S. Trust advisors, with an average client account size of $5 million; the average account size for Merrill’s 280 PBIG advisors is $25 million.

The advisor says Merrill’s global private client group contributed revenue of about $1.2 billion in 2008 with just 280 advisors (though Merrill doesn't break this out and couldn't confirm that number). By comparison, U.S. Trust showed revenue of $2.7 billion in 2008 with about 800 advisors, according to its earnings report.

Bank of America spokesman John Yiannacopolous says the PBIG broker’s presumption couldn’t be further from the truth: “BofA is very committed to the U.S. Trust business and model,” he said. “Both of these firms have tremendous wealth management capabilities to offer clients and when you combine them we think they’re unmatched in the industry,” he said. According to the spokesperson, U.S. Trust is the largest private bank in the U.S. by deposits ($38 billion), total client assets ($300 billion) and number of client associates (4,000).