http://66.225.205.104/SO20091214.mp3
The Securities and Exchange Commission is broadening its probe into Bank of America's merger with Merrill Lynch. That's according to the commission's Enforcement director who spoke to a House Committee on Oversight today. Back in August, The SEC announced it came to a $33 million settlement with Bank of America over allegations the bank did not let shareholders know it approved Merrill Lynch paying out nearly $4 billion in bonuses before it acquired Merrill. Shortly after, Merrill posted $27 billion in losses for the year. Under terms of the settlement, the bank did not acknowledge wrongdoing. But a federal judge rejected it and has asked both parties to go to court. At a hearing today by the House Oversight Committee, Congressman Dennis Kucinich of Ohio said the bank hid from shareholders the fact that it knew about Merrill Lynch's mounting losses long before shareholders approved the deal. He asked SEC Enforcement Director Robert Khuzami whether the regulator plans to pursue the bank further beyond disclosure over the bonuses. "We have been and are looking at all aspects of actions with respect to the proxy statements including the fourth quarter losses at Merrill Lynch," said Khuzami. Kucinich asked, "Is that a yes or a no?" " That's a yes." The committee also heard from FDIC chair Sheila Bair who said her commission had a small role in the deal and that she wishes her office had more of a say in the decision to give the bank bailout money. It was the committee's fifth and final hearing on whether Bank of America took action to protect shareholders in its deal with the troubled investment institution.