Updated from 4:29 p.m. EDTWall Street's latest scandal spread to Merrill Lynch ( MER) Friday when the brokerage fired three brokers who had dealings with Millennium Partners, a hedge fund that's been linked to sure-thing bets in mutual fund shares, a source said. The firings come a day after Steven Markovitz, a former Millennium trader, pleaded guilty to securities fraud and engaging in illegal late-day trading in shares of numerous mutual funds. Merrill Lynch has an extensive relationship with Millennium, a $3 billion hedge fund based in Manhattan. The big Wall Street firm is its main broker, meaning it loans it money and executes and processes its trades. The three brokers were fired for violating a firm policy that prohibits "certain short-term trading." But a Merrill Lynch spokesman denied that the brokers had engaged in any late-day trading. A source close to the investigation confirmed that, saying Markovitz made his late-day trades elsewhere. Markovitz pleaded guilty in an ongoing inquiry into illegal trading by hedge funds of mutual fund shares that's being led by New York Attorney Eliot Spitzer. Markovitz, 41, is cooperating with investigators and has promised to testify at any future trials as part of his plea bargain.