NYAG Back to Hounding BofA
New York Attorney General Andrew Cuomo’s office is again requesting information from Bank of America (BofA) as part of an ongoing investigation into its January 1 acquisition of Merrill Lynch.
In a letter to BofA yesterday, the State of New York Office of the Attorney General (NYAG) said it has found at least four instances in the fourth quarter of 2008 where BofA failed to disclose material non-public information to shareholders. The information is related to losses suffered by Merrill Lynch and bonuses paid to Merrill Lynch executives before the merger (see “Cuomo Says Merrill Accelerated Bonus Payments”).
Cuomo’s office charged that BofA continues to improperly cite attorney-client privilege as its reason to not disclose information to shareholders and requested that Bank of America reconsider keeping that information hidden from the investigation. The NYAG requested BofA’s decision by September 14. The letter said: “Otherwise, we will proceed with our charging decisions without giving credit to the advice of counsel defenses that Bank of America has not permitted us to test.”
BofA is also awaiting judicial approval of a $33-million settlement with the Securities and Exchange Commission (SEC) over disclosures of the bonuses paid to Merrill executives. A judge seemed skeptical of BofA’s use of attorney-client privilege and has requested more information from BofA and the SEC (see “Judge Still Not Satisfied with BofA, SEC Settlement”).