In court filings to the New York State Supreme Court, Cuomo rejected Bank of America’s attempts to avoid disclosing the names of and amounts paid to bonus recipients, according to news reports. Bank of America Chief Executive Kenneth Lewis has refused to turn over the names (see “Merrill Executives Subpoenaed in Bonus Probe’ and “BoA Gets Subpoena to Release Bonus Information’).
Cuomo is investigating whether the bonuses violated securities laws and whether Bank of America should have disclosed more about Merrill’s losses sooner, Reuters said.
Bank of America counters that revealing the data would put them in a poor spot with competitors, making it hard to retain staff, according to news reports.
Cuomo also alleged that Merrill Lynch traders might have booked hefty losses later in 2008 only after learning of their 2008 bonuses, and that Merrill executives did not revisit their decision to pay out $3.62 billion of bonuses, Reuters reported. Cuomo said in the court filing that approving the bonuses in December was “unprecedented at Merrill and particularly imprudent considering the tatters in which the economy lay at the time the bonuses were voted,’ according to The Wall Street Journal.
Bank of America, which acquired Merrill Lynch January 1, has accepted $45 billion overall from the Troubled Asset Relief Program (TARP), according to Reuters.