SEC brings new charges against Bank of America

[Blue_Tires]

Source: AP

NEW YORK

Federal regulators sued Bank of America Corp. on today, accusing the company of failing to disclose "staggering financial losses" at Merrill Lynch before shareholders approved a combination of the companies.

The lawsuit filed by the Securities and Exchange Commission in U.S. District Court in Manhattan sought an order requiring Bank of America to pay a civil penalty for not telling shareholders it was losing $15.3 billion in the fourth quarter of 2008.

Bank of America spokesman Robert Stickler called the charges "totally without merit." The company believes it provided sufficient and appropriate disclosure to shareholders before their vote approving the combination, he said. "We look forward to presenting the facts in court. What we would note is that there were no charges against individuals and no charges of fraud. We were pleased with that."

The SEC said the information about the losses should have been announced when it was learned after the companies publicly announced their deal in September 2008. They did not obtain shareholder approval until three months later. Federal laws governing such transactions require that losses be revealed if they were not already reflected in Merrill's quarterly reports or other filings.

The SEC and Bank of America, which is based in Charlotte, are already scheduled to go to trial March 1 after the SEC previously accused the bank of failing to disclose billions of dollars in bonuses paid at Merrill Lynch after the acquisition was completed a year ago.

In the new lawsuit, the SEC said Bank of America "learned of staggering losses at Merrill" in October and November of 2008.

Read more: http://hamptonroads.com/2010/01/sec-brings-new-charges-against-bank-america

[Tansy_Gold]

1. "there were no charges against individuals"

So, let's see, the entity known as Bank of America did this without the use of humans?

How will that entity testify in its own defense? How will it hire counsel?

Unlike Soylent Green, corporations are not people in and of themselves. Only people can act on behalf of corporations, not the other way around.

[naaman fletcher]

3. There's a good explanation, actually..

They were doing the governments bidding, both in buying Merrill and covering up the losses. The government figures that if it charges the individuals they will vigorously defend themselves and cause a scandal, so BAC as a whole will probably just cough up some nominal fine.

Note, when I say good explanation, I am not saying this is all a good thing, just explaining what is happening.

[stuart68]

4. Excellent !

one more of the "you're just not smart enought to understand our plan so we'll keep you in the dark for your own good" scenarios. Gets my vote.

Just like TurboTax Timmy and the NY Fed telling others to "keep it quiet". We'll find that this was to prevent armageddon (SP), the greater depression and all other sorts of nastiness. What I woudl love to know is how much money these conspirators made from the process. Must have been great money !

[NotNarrow]

2. Moral Hazard

We need better use of the concept of "moral hazard" (http://www.investopedia.com/terms/m/moralhazard.asp). Just shut down Bank of America and end the tyranny.

[galileoreloaded]

5. The days of the SEC being a credible regulator are long past.

It is "feather your nest" time, and Mary Schapiro is the WORST. Rotten to her black core.

[Blue_Tires]

8. +1

[unkachuck]

6. what?!

....who in the private-sector gave the SEC permission to file this lawsuit?....this is bullshit....the Obama administration should be be taken to the woodshed for picking on an innocent corporation....

[hughee99]

7. So at the same time in Q4 '08 that they took these staggering losses,

they were also covering up the billions in bonuses they paid to those who racked up those loses. Nice!