Merrill Lynch has hired Giuliani Partners, the advisory firm set up by former New York mayor Rudy Giuliani, in its battle to avoid criminal proceedings over the bank's 'tainted' equity research.

Giuliani, who set up his new advisory firm in January, is to guide Merrill in its negotiations with Eliot Spitzer, the New York State attorney general who is attempting to rid Wall Street of what he sees as dishonest equity research. Giuliani is a republican while Spitzer is a democrat.