Bank of America Corp.'s Merrill Lynch unit will pay $415 million to resolve accusations from the Securities and Exchange Commission that it misused customer cash, the agency said Thursday.

The brokerage should have deposited the customer funds in a reserve account, but instead engaged in complex options trades that artificially reduced the amount it needed to deposit, freeing up billions of dollars each week to finance trading activities, the SEC said.

Merrill admitted to wrongdoing in the trades, which occurred between 2009 and 2012, the agency said.

The SEC also sued the firm's head of regulatory reporting, , in connection with the case.

William Tirrell

Mr. Tirrell is disputing the charges.

Merrill Lynch also separately agreed to pay a $10 million penalty to resolve an SEC case accusing it of misleading customers on structured notes. It also paid an additional $5 million to settle a similar case from the Financial Industry Regulatory Authority, the Wall Street regulator said Thursday.

Write to Aruna Viswanatha at Aruna.Viswanatha@wsj.com

(END) Dow Jones Newswires

June 23, 2016 11:15 ET (15:15 GMT)

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