What seems like a minor back-office move could make a world of difference to Bank of America clients and wealth advisers.

Letters are now going out to B of A investment clients explaining that in a couple of months their accounts will move from Fidelity's National Financial trade clearing and processing platform to the Merrill Lynch Pierce Fenner & Smith clearing platform, according to former B of A advisers.

Bank of America Investments advisers officially became Merrill Lynch advisers in October, according to Bank of America spokesman Matthew Card. He said all new accounts that have been opened since then are already on Merrill's platform.

But questions surround what will happen to BAI clients when Merrill transitions their accounts from National Financial. Merrill will likely impose its account minimums on advisers, according to advisers and a former Merrill manager who declined to comment but corroborated the details of this story. This might work in the high-net-worth world of the traditional brokerage, but bank-brokerage clients won't necessarily meet Merrill's $250,000 minimum to work with an adviser.

B of A clients who don't make the grade at Merrill will be shunted to a call center, according to a former B of A adviser turned independent. Card said that clients of any account size get to choose whether they want to work with an adviser or a call center, although "our direct investment division will generally serve clients with a combined banking and investment relationship of less than $250,000."

Carl Cafaro, a legacy BAI adviser and team-leading $2 million producer in Newton, Mass., said he doesn't think Merrill is likely to enforce its minimums.

"Everything I've seen in writing is that advisers can run their books as we want and that there will be no mandatory movement of clients," he said. "As an adviser, you could look at your practice and focus on clients with more money, but nobody's making you do it."

The former B of A adviser, who requested anonymity, disagreed with Cafaro. "Before I left, they gave us our runs of all our clients earmarked for the call center," he said. "Wave one was for clients under $75,000, wave two was clients under $100,000 and wave three, which was after I left, was for clients under $250,000."

At legacy B of A, clients could sit down and talk to an adviser regardless of their asset level.

"You've got to have personal service — a lot of B of A clients are under $100,000," the independent adviser said. "They deserve being able to visit a broker in a branch."

Card, who concedes most sub-$250,000 clients will choose to work with a call center rather than in person with a Merrill adviser, said that there will soon be Merrill advisers in B of A branches. The bank rolled out an in-branch program late last year in Boston, Chicago and Seattle, in which advisers "offer clients access to face-to-face assistance (within their local branch) with organizing their finances and developing a financial plan using Merrill Lynch's world-class analytical tools and technology."

Card said that these advisers help "ensure that [clients] are introduced to the appropriate Merrill Lynch service channels that best meet their needs." The program, which Card said has met with success, will soon be rolled out in other areas of the country.

"We have been successful in our efforts to thoughtfully and rapidly integrate our banking and brokerage businesses," Card said, but other accounts suggest B of A advisers' transition to Merrill Lynch management has not been a happy one so far.

Rick Rummage, a managing partner of Rummage Group, a recruiting firm in Reston, Va., said that out of 2,500 reps before the bank bought Merrill, roughly 1,000 have already left, and he predicts as many as half of the B of A advisers still there will quit within the next 12 months.

"Merrill doesn't care," Rummage said. "It wants the accounts, not the brokers. It doesn't have any respect for bank reps at all. [B of A reps] are making the best of it, but they're fish out of water."

Card said that while a few advisers may have left the firm, many of their clients have remained. "Among the small population of financial advisers who have chosen to leave the firm, more than 60% of their clients have chosen stay with us; this is a testament to the strength of our platform and the confidence our clients have that this is the best place to do business," he said.

Things are bound to get worse, the independent adviser said, and it isn't all the fault of Merrill's notoriously cocky culture and sky-high production goals, anathema to the average bank rep. "It's total confusion, and B of A is beginning more and more to push product, which is not good for anyone," advisers or clients, he said.

Managers of what was BAI are allegedly pushing advisers to sell managed accounts, though the independent adviser said there isn't much active management going on. "Clients are being moved to a fee-based structure, but into portfolios that are completely static, when what they're paying for is economic guidance built around their individual needs," he said.

B of A clients would have more options for fee-based accounts on Merrill's platform, but only if they meet Merrill's account minimums — and many don't. The bank's plan is to charge the sub-$250,000 minimum brokerage clients a fee wherever possible for their accounts at call centers, the independent adviser said. Card denied this.

Moving many of B of A advisers' clients to the call center will hurt advisers, too. "It's a huge problem," the independent adviser said. "There may be thousands of accounts under Merrill's minimums, which will mean a massive drop in production for B of A reps when they join the Merrill platform in a couple of months" and are forced to ditch their smaller clients.

That'll make life even more unpleasant for B of A reps who have below-average production. "Merrill is playing real nice right now, no heavy sales pressure. But where a broker has a $250 million book and isn't producing $3 million, it makes more sense to Merrill to lose the broker and split up his book," the independent adviser said. "A lot of B of A guys at Merrill right now are thinking it isn't that bad. But once their assets are on the Pierce system, Merrill is famous for flicking the switch. The guys still there will end up walking away with nothing."

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