Bank of America Withheld Loss Figures Ahead of Merrill Vote

Bank of America Withheld Loss Figures Ahead of Merrill Vote

Days before Bank of America shareholders approved the bank’s $50 billion purchase of Merrill Lynch in December 2008, top bank executives were advised that losses at the investment firm would most likely hammer the combined companies’ earnings in the years to come. But shareholders were not told about the looming losses, which would prompt a second taxpayer bailout of $20 billion, leaving them instead to rely on rosier projections from the bank that the deal would make money relatively soon after it was completed.

What Bank of America’s top executives, including its chief executive then, Kenneth D. Lewis, knew about Merrill’s vast mortgage losses and when they knew it emerged in court documents filed Sunday evening in a shareholder lawsuit being heard in Federal District Court in Manhattan.

The disclosure, coming to light in private litigation, is likely to reignite concerns that federal regulators and prosecutors have not worked hard enough to hold key executives accountable for their actions during the financial crisis.

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Comments
4 Responses to “Bank of America Withheld Loss Figures Ahead of Merrill Vote”
  1. readdocs says:

    I hear a hand slap coming.

  2. talktotennessee says:

    There seems to be little motivation to hold mega banks responsible for their lies, misrepresentation, even illegal or fraudulent activity. They keep a huge legal department for damage control!
    If there is no money and an uphill fight against these banks there seems to be little motivation to hold them accountable. Players get paid off in civil suits,like Wells Fargo’s little handout here in Memphis who bought off the city for a pittance and no fault admittance. Wells gained a lot of favorable press as saviors of the poor in the Commercial Appeal without helping any they defrauded with predatory loans nor in modification of current loans. Similarly, banks buy their way out of most of this junk because it is all about money and they seem to have enough (in another deep pocket) to handle their legal problems.

  3. Bill McAuliffe says:

    REIGNITE ?

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