New York, May 23 - Merrill Lynch & Co., J.P. Morgan Chase & Co. and Credit Suisse First Boston have hired
consultants to monitor their research practices to comply with the $1.4 billion conflict-of-interest settlement with regulators.
Merrill Lynch, the biggest securities firm by capital, has hired former OppenheimerFunds Inc. Chairwoman Bridget Macaskill, said Mark Herr, a spokesman for Merrill.
J.P. Morgan, the second-biggest U.S. bank, has hired former acting Securities and Exchange Commission Chairwoman Laura Unger and Credit Suisse First Boston, a unit of Switzerland's second-biggest bank, hired Patricia Chadwick, founder and president of Ravengate Partners, the New York Post reported without citing
anyone.
Unger did not return a voicemail message. Chadwick's office at Ravengate said she wasn't available for comment. Credit Suisse First Boston spokeswoman Victoria Harmon and J.P. Morgan spokesman
Joe Evangelisti declined to comment.
The 10 investment banks that settled with regulators agreed last month to hire the consultants within 30 days of a judgment by U.S. District Court Judge William Pauley III, according to the Securities and Exchange Commission Web site. The advisers will procure research reports from independent research companies that don't conduct investment banking or brokerage services.
"I hope they've internalized their need for change," New York Attorney General Eliot Spitzer said of the firms in an
interview yesterday.
Goldman, Lehman
Goldman Sachs Group Inc., the world's third-largest securities company, has hired a consultant who has been approved by regulators, said spokesman Ed Kennedy. He would not provide the name of the person. Lehman Brothers Holdings Inc. is awaiting regulatory approval for the candidate it has selected, said Kerrie
Cohen, who declined to name the person.
Macaskill was among the highest ranking women in the U.S. mutual fund business. She worked at OppenheimerFunds for 18 years and was involved in running the firm since 1989, when she was named chief operating officer. Macaskill left the company in July 2001.
Unger, who was acting SEC chairwoman for six months in 2001, was the only vote against Regulation Fair Disclosure, an SEC rule that forbids companies from giving brokerage analysts or big stockholders advance word of important news.
Citigroup Inc. hasn't yet hired a compliance monitor, spokeswoman Leah Johnson said. Morgan Stanley spokeswoman Diana Quintero and U.S. Bancorp Piper Jaffray spokeswoman Susan Beatty declined comment. Bear Stearns & Co. spokesman Russell Sherman didn't return a voicemail message.
UBS Warburg spokesman Paul Marrone said the company is searching for a research monitor. "We haven't identified anyone yet,'' he said.
Spitzer spokesman Brad Maione declined to comment on the appointments or other candidates for consultant roles that investment banks may be considering. John Nestor, an SEC spokesman, declined comment.
Merrill Lynch is a passive minority investor in Bloomberg LP, the parent of Bloomberg News.
