Busted: Bankers and The Global Economy

February 22, 2010

Bank of America Fined

Filed under: banking, economy — Tags: , , , , , , , — digitaleconomy @ 10:47 am

A federal judge has reluctantly approved a $150 million settlement with the Securities and Exchange Commission stemming from the bank’s merger with investment firm Merrill Lynch at the height of the financial crisis. In the months before the deal closed, Bank of America failed to disclose that hefty bonus payouts or the mounting losses that eventually led to a second government bailout of $20 billion for Bank of America.

The New York judge admitted that the fine is a slap on the wrist, but was the second settlement that the SEC had cobbled together that he felt was reasonable. While Bank of America had failed to adequately disclose the bonuses and the losses, the judge agreed that circumstances were unclear, uncertain as whether the lack of disclosure resulted from negligence or fraudulent intent.

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