Keith Schooley, a former Merrill Lynch financial consultant, has opened an official Facebook page for his book, Merrill Lynch: The Cost Could Be Fatal, which recounts his nine-year battle with the Wall Street giant. The move is significant because it seeks to broaden the reach of a story that raises uncomfortable questions about how the securities industry treats employees who report wrongdoing and how investor claims are adjudicated.
Schooley joined Merrill Lynch in July 1991 as a trainee in a small Oklahoma branch. He scored 93.2 percent on the Series 7 exam and ranked among the top ten rookie producers in his division. Fourteen months later, he was out of the securities industry for good. The book’s title comes from the firm’s own general counsel, who warned in a 1992 employee publication that letting integrity take second place to revenue would cost the firm more than dollars: “The cost could be fatal.”
Citing the firm’s written requirement that employees report improprieties to whatever level of management is necessary, Schooley wrote a four-page memo to his branch manager and then a 31-page letter to all thirteen members of the board of directors. What followed, as Schooley tells it, was two internal investigations, inquiries by the SEC, the NYSE, the NASD and two state insurance departments, his own termination, a forced move into binding securities arbitration, a four-day hearing, and more than a decade of appeals. The arbitration panel awarded him nothing.
Schooley does not hide that result. The book opens with a foreword by his former attorney, Stephen Jones, who states plainly that Schooley lost, and who argues the real subject is not one man’s case but whether investors should have claims decided by arbitrators rather than juries. Jones tells readers that each of them becomes “one of the jurors he never had.” The book reconstructs the dispute from Schooley’s memos, letters, regulatory correspondence, recorded telephone conversations and the transcript of the arbitration hearing, including the testimony of the firm’s own compliance and legal executives.
The new Facebook page is intended to put the account in front of readers who have never heard of it, with Schooley asking supporters to like and share it. The book is available for purchase at https://www.amazon.com/dp/B0HKY222R6. By making his case more accessible, Schooley’s effort could intensify scrutiny of mandatory arbitration clauses that often keep such disputes out of public view and limit the ability of wronged employees and investors to seek redress before a jury.
