George S. May Business Blog

NY Attorney General Andrew Cuomo subpoenas five Bank of America Directors

In a world where high ranking executives, officials, and politicians talk, talk, talk, and rarely walk, you must admit that Andrew Cuomo walks, talks, and most importantly, prosecutes. This man never sleeps!

“New York Attorney General Andrew Cuomo has issued subpoenas to at least five board members at Bank of America demanding their testimony under oath about their knowledge of mounting losses and bonus payments at Merrill Lynch prior to BofA’s takeover of the firm on January 1, according to a source close to the investigation.

The move ratchets up the pressure on Bank of America as Cuomo’s office presses its probe.

Reached for comment, a Bank of America spokesman said the firm and its executives had engaged in no wrongdoing.

“We will continue to cooperate with the attorney general’s office as we maintain that there is no basis for charges against either the company or individual members of the management team,” he said.

The source said investigators believe board members may have been briefed on losses and bonuses as early as the beginning of December, and the subpoenas to the board suggest Cuomo is not willing to limit his investigation to executives of the two firms.

Meanwhile, pressure is mounting on those executives as well. The source says the new subpoenas are independent of Cuomo’s warning last week that he could file charges in a matter of weeks against individual executives, after uncovering evidence that the company withheld information from shareholders on multiple occasions.

A final decision on charges has not been made, the source said.

Cuomo and U.S. District Judge Jed Rakoff aren’t the only ones raising new questions about the merger of BofA/Merrill Lynch-and the proposed $33 million settlement between BofA and the Securities and Exchange Commission.

The SEC’s Inspector General, David Kotz, is also pressing an investigation begun last month at the request of Rep. Elijah Cummings, D-Maryland. Cummings asked Kotz and Special TARP Inspector General Neil Barofsky last month to investigate the settlement, and whether shareholders and taxpayers would ultimately pay the price.

Barofsky and Kotz agreed that Kotz would investigate the proposed settlement, since Barofsky is already investigating the merger itself.

In an August 20 letter to Cummings obtained by CNBC, the two Inspectors General said they shared Cummings’ concerns about the settlement, which was since rejected by Judge Rakoff.

Kotz’s investigation is continuing despite the judge’s action, and a spokesman for Cummings says the fact that the settlement is off the table does not affect the Congressman’s desire to see an investigation.

In fact, the investigation could intensify now that the settlement has thrown out.” (source)

Related posts:

1. Bank of America to hand over legal documents from the Merrill purchase — Andrew Cuomo victorious yet again Well, it is official; Andrew Cuomo gets what he wants. NY Attorney General, Andrew Cuomo has been pressing B of A to to turn over...


2. Bank of America looking to settle the score with Cuomo The New York Times is reporting that Bank of America is in talks with New York attorney general Andrew Cuomo’s office about settling a probe...


3. THE PEOPLE’S CHAMP — Andrew Cuomo goes after GameStop, Barnes and Noble and 20 other online merchants for “tricking customers” NY Attorney General Andrew Cuomo never sleeps. GameStop has been deemed a possible culprit, by Cuomo, for slamming unknowing on-line customers with extraordinary fees and account...


4. Bank of America still in shambles — Bank posts $9.6 billion Q3 credit loss Two taxpayer bailouts, equating to $45 billion, later, Bank of America still can not get it together. America’s largest bank, BofA, posted a big third...


5. BREAKING NEWS: Bank of America is actually doing something right Over the last half year it seemed that the folks at Bank of America could not make a good decision for the life of them....