When my husband died his/my financial planner transferred his 401K, in its entirety, into my name. Now (over 3 years later) I went through the estate papers again and found a less than $10,000 SEPARATE 401K he held with another brokerage house. I am also the direct beneficiary of this account.

That broker tells me I can transfer the 401K ino my own name but I cannot liquidate it.

Is that true? Or could I liquidate and pay taxes on it?

I see no point in having this second account.

Once the 401K is transferred to your name, you should be able to consolidate it into your other account with no tax consequences. There may be a waiting period, but no longer than one year.