New York Attorney General Andrew Cuomo has filed civil securities fraud charges against Bank of America and the firm’s former CEO Ken Lewis, reports (sub. req.) the Wall Street Journal.
Cuomo alleges that Lewis, Chief Financial Officer Joe Price, and other BofA execs, chose not to disclose to shareholders the extent of the losses at Merrill Lynch before BofA bought the ailing Wall St. investment bank in late 2008.
Said BofA in a statement:
We find it regrettable and are disappointed that the NYAG has chosen to file these charges, which we believe are totally without merit.
The Treasury Department, concerned that a Merrill collapse would have wider repercussions, reportedly pressured BofA to go ahead with the purchase, despite the qualms of Lewis and others.
Separately, BofA and the SEC came to a deal in which the bank will pay $150 million
to settle allegations that it misled investors about the Merrill purchase.