First, a federal judge again scotched the company's $33 million settlement with the SEC over charges the banking giant improperly disclosed $3.6 billion in financial bonuses paid to employees of its Merrill Lynch unit. The agreement with securities regulators "cannot remotely be called fair" and "does not comport with the most elementary notions of justice and morality," reportedly said U.S. District Judge Jed Rakoff in rejecting the pact for a third time. He ordered a trial due to begin Feb. 1.
Second, New York Attorney General Andrew Cuomo is likely to file civil charges against B of A executives "over their role in failing to alert shareholders to mounting losses as well as accelerated bonus payments at Merrill," according to the AP.
Sticking it to Wall Street has long been a popular sport among politicians, and the money trust has duly played its part over the years by showing it can't be trusted with money. Clearly, Cuomo smells a winner here (and B of A's conduct in the Merrill affair has certainly invited scrutiny). Earlier this summer he issued a widely publicized report documenting the excesses of banker pay. Now he's painting a bull's-eye directly on B of A.
In a Sept. 8 letter to Lewis Liman, the outside lawyer representing B of A in the bonus case, Cuomo lieutenant David Markowitz accused the company of deliberately hindering the AG's investigation. And he all but painted a scarlet letter on B of A:
These irregular bonus payments were not disclosed. . . even though they clearly should have been under the circumstances. The payments were made even though Merrill faced results so disastrous that Bank of America was seeking to tenninate the transaction. In fact, Bank of America only went forward with the transaction after its executives were threatened with removal and after getting verbal commitments from the United States Treasury to support the merger with taxpayer funds.There's gonna be a lynchin'! Don't forget the popcorn.