Stock Market: Merrill Lynch Censured

The smallest dabbler in penny stocks and the manager of a billion-dollar mutual fund have at least one thing in common: both men are always alert for the inside tip, the informed gossip that can lead to quick profit. Not surprisingly, stockbrokers often pick up those tips ahead of their customers. And they usually pass the information along to large institutions whose trading pays big commissions. Last week, for just such misuse of inside information, the Securities and Exchange Commission severely penalized the world's biggest brokerage house, Merrill Lynch, Pierce, Fenner & Smith.

Consent and Denial. In its confidential role...

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