Bank of America fined $33m over Merrill bonus disclosure
The Securities and Exchange Commission has reached a $33 million settlement with Bank of America for allegedly misleading its shareholders about bonuses paid to Merrill Lynch employees late last year. Bank of America and CEO Ken Lewis asked shareholders to approve the purchase of Merrill as the financial markets caved, giving cooing reassurances about bonuses. In fact it was a bonus jackpot.
So: The government that pressured Lewis to go through with the Merrill acquisition is now penalizing Bank of America for allegedly hiding information that might have caused shareholders to reject the deal. Damned if BAC does/doesn't. Such is the legal confusion when the law is abused as it was last fall. And who has to pay the $33 million? Bank of America shareholders -- the ones who were suppoesdly the victims.
WASHINGTON (AP) — Bank of America has agreed to pay a $33 million penalty to settle government charges that it misled investors about Merrill Lynch's plans to pay bonuses to its employees.In seeking approval to buy Merrill, Bank of America told its shareholders that Merrill agreed not to pay year-end bonuses without Bank of America's consent. But the Securities and Exchange Commission says Bank of America had authorized New York-based Merrill to pay $5.8 billion in bonuses.
Comments
The thing that I find odd about the BofA penalty is that I am 99% certain that I heard that the Merrill bonuses would be paid--and this is back when the acquisition first occurred. I'm 99% certain this was made known in the national media last fall.
Posted by: Laura | August 4, 2009 1:32 PM