Bank of America is again in the center of the latest controversy as it relates to real estate and their dealings with everyone around them while their only goal seems to be very simple, “Get Paid.”
New York Attorney General, Andrew Cuomo, uncovered a very disturbing cover-up within BofA as it relates to their acquisition of Merrill Lynch, this past January. Those findings were shared with the SEC who launched their own investigation and charged BofA for their latest misconduct. As I have noted my beliefs before, BofA, seems to just want to make money and is not really interested in who it needs to step on in order to reach that goal. I’ve also mentioned how they have stepped on the homeowners who took their mortgages, the investors they tricked into buying those mortgages and whom they now charge to service them. But this latest case should absolutely convince even the hardened believer that this mess was brought upon the homeowners themselves and the Lenders are innocent victims, of the unscrupulous actions taken by BofA and that their motives are purely about the bottom line.
The SEC charges that BofA LIED to their stockholders about the payments of Billions of dollars in bonuses to Merrill Lynch executives at a time they were about to close their acquisition and in receipt of Federal Bailout Money. The stockholders were told by BofA that there were no bonuses being paid while at the same time they had already agreed to let Merrill Lynch pay out those bonuses. This was at a time when both institutions were being crippled with loses in the BILLIONS, because of the Toxic Mortgages given out. It became so bad that BofA had to go back to Congress and request a second infusion of bailout money, which they received. What was the total of the bonus money paid to the Merrill Lynch executives? The total payout in bonuses was $5.8 Billion dollars. Keep in mind that the total amount BofA paid for Merrill Lynch was $50 Billion…so a total of 12% of the acquisition cost went towards those bonuses.
The SEC and BofA settled this case with a fine of just $33 million and BofA did not have to disclose their guilt in this case. However, the story doesn’t end there. New York Attorney General Andrew Cuomo states that his investigation is not over and he will pursue any actions as they pertain to New York.
Go get em Andrew!
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