Bank of America Corp (NYSE:BAC) Cleared of Wrongfully Firing General Counsel
Wednesday, February 17th, 2010
The longer the investigation into Bank of America (NYSE:BAC) goes concerning the Merrill Lynch deal, the less it looks like there was any wrongdoing on their part, and the latest discovery was the firing of their general counsel had absolutely nothing to do with the advice given concerning the Merrill Lynch deal.
Rather the firing came about from Mayopoulos needing to be terminated in order to retain Brian Moynihan, who now is the CEO of the company. The exact reason for the firing hasn't been released, but the SEC concurs that it was unrelated to any of the events surrounding Merrill Lynch.
U.S. District Judge Jed Rakoff seems to be taking on the role of an activist judge rather than attempting to find out the truth, as he seems to be making his decisions based on his personal feelings or suspicions, rather than the evidence.
He has went so far as to ask why there aren't any individuals at Bank of America being prosecuted, as if that's the ultimate goal in the case: to punish executives for being part of the bank, rather than for any possible wrongdoing, which the SEC has stated more than once never took place on an individual basis.
Oddly, Rakoff asked the SEC why they viewed how Mayopoulos was fired differently than the publicity-seeking New York Attorney General Andrew Cuomo. The answer is obvious, the SEC knows more about the inner workings of the situation since they've been communicating with Bank of America for months on the issue.
Of course this has nothing whatsoever to do with anything concerning the problem, as how Cuomo views anything is irrelevant, and we'll find that he has nothing to stand on either, and is positioning himself to curry favor with his constituents at a time when it is highly politically advantageous to do so.
To me this is largely a non-event that witch hunters are trying to create into something bigger than it really was, or in fact, is really nothing other than a company acting upon the advice of their lawyers.
While there is plenty of blame to go around in the overall economic fiasco, focusing on the Merrill Lynch merger with Bank of America is the least likely to do any good, and in fact, if it ends up going to trial, it could be found they are not guilty of anything at all.
Judge Rakoff had previously rejected a proposed $33 million settlement between the SEC and Bank of America, and now is asking these question in response to a proposed $150 million settlement.
I don't see any reason why this should proceed any further, and it doesn't seem to be doing any good or is finding any smoking guns. It's largely a waste of time by a judge who is evidently under pressure from someone to keep this going even in the light of no misconduct whatsoever.
Article by Gary B
The views expressed are the subjective opinion of the article's author and not of FinancialAdvisory.com
Tags: andrew cuomo , bank of america , merrill lynch , sec
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