GROWING ANGER OVER WALL STREET BONUSES
Cuomo Said to Eye Return of $4 Billion in Early Merrill BonusesBy Erik Larson
Jan. 29 (Bloomberg) -- New York Attorney General Andrew Cuomo may demand the return of $4 billion in bonuses paid by Merrill Lynch & Co. just before it was acquired by Bank of America Corp., a person familiar with the matter said.
Cuomo also wants to know what Bank of America Chief Executive Officer Kenneth Lewis, 61, knew about the accelerated bonuses and about Merrill’s surprise $15 billion net loss in the fourth quarter, the person said. Lewis fired Merrill’s CEO John Thain this month after the losses required more federal aid.
The attorney general’s office is looking at whether the companies’ shareholders had all necessary information about Merrill’s finances and whether federal bail-out loans to Bank of America were used properly, the person said, asking not to be identified because the investigation is confidential.
“No longer will this country stand for wasteful spending of tax dollars on bonuses for executives whose companies have taken huge losses and required taxpayer bailouts,” Cuomo said today in a statement about bonuses paid at Wall Street firms that received funds from the Troubled Asset Relief Program or TARP.
The Wall Street Journal reported the expanded nature of Cuomo’s investigation earlier today.
Thain, 53, and Bank of America’s chief administrative officer were subpoenaed this month by Cuomo. The attorney general wants to find out what Thain told his firm’s directors and Bank of America officials about ballooning losses in December, the person said. Thain was in charge of trading, investment banking and brokerage operations at the combined company, which is based in Charlotte, North Carolina.
Possible Fines Cont.
Jan. 29 (Bloomberg) -- New York Attorney General Andrew Cuomo may demand the return of $4 billion in bonuses paid by Merrill Lynch & Co. just before it was acquired by Bank of America Corp., a person familiar with the matter said.
Cuomo also wants to know what Bank of America Chief Executive Officer Kenneth Lewis, 61, knew about the accelerated bonuses and about Merrill’s surprise $15 billion net loss in the fourth quarter, the person said. Lewis fired Merrill’s CEO John Thain this month after the losses required more federal aid.
The attorney general’s office is looking at whether the companies’ shareholders had all necessary information about Merrill’s finances and whether federal bail-out loans to Bank of America were used properly, the person said, asking not to be identified because the investigation is confidential.
“No longer will this country stand for wasteful spending of tax dollars on bonuses for executives whose companies have taken huge losses and required taxpayer bailouts,” Cuomo said today in a statement about bonuses paid at Wall Street firms that received funds from the Troubled Asset Relief Program or TARP.
The Wall Street Journal reported the expanded nature of Cuomo’s investigation earlier today.
Thain, 53, and Bank of America’s chief administrative officer were subpoenaed this month by Cuomo. The attorney general wants to find out what Thain told his firm’s directors and Bank of America officials about ballooning losses in December, the person said. Thain was in charge of trading, investment banking and brokerage operations at the combined company, which is based in Charlotte, North Carolina.
Possible Fines Cont.
posted by Kangaroo Brisbane Australia at 6:07 PM
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