Merrill Advisors Get Confirmation: "Garden Leave" For U.S. Trust Defectors Only Hot

Last month, word that resigning U.S. Trust advisors now need to give 60 days notice -- and will have to spend those two months doing grunt work on reduced-pay "garden leave" -- rippled through the industry.

Although even at the time, the new rules were only aimed at U.S. Trust, which Bank of America bought back in 2006, reps at Merrill quickly got worried that they would be next.

The fact that Krawcheck had to quash the rumor by telling her people to "please put that one in the circular file" reveals quite a bit about the mood at Merrill these days. 

But if their morale has taken a hit, imagine how they feel at U.S. Trust, which was once one of the crown jewels of the ultra-high-net-worth world.