BofA Still Getting Sh*t From Merrill Judge
This is just too funny. What, did BofA and the SEC think they'd be able to just sweep everything neatly under the rug? WRONG, try again!
Jed S. Rakoff, a United States District Court judge in Manhattan, is not one to rubber-stamp administrative decisions.
Known as a maverick in legal circles, Judge Rakoff has in the past found the death penalty illegal, inserted himself into corporate governance reform at WorldCom, and pushed for the release of documents in private settlements.
Now he is tussling with the Securities and Exchange Commission and Bank of America, which will both file reports to him Monday detailing who knew what about $3.6 billion in bonuses paid out by Merrill Lynch just before Bank of America took it over last year.
The Merrill payouts have been at the center of hearings in Congress as well as an investigation by the New York attorney general. But Judge Rakoff is the first to demand that Bank of America reveal who decided not to disclose the bonuses to shareholders before the merger with Merrill closed.
In an interview last week, shortly after he rejected a settlement between the agency and the bank that was meant to put the matter to rest, he remembered a time when executives were held more directly accountable for actions taken by their companies.
Decades ago, when he began his career in the securities fraud unit of the Southern District of New York, prosecutors placed greater accountability on individual executives at companies, he recalled. Charges tended to be filed mostly against those people, rather than against the corporation.
“The feeling then,” he said, “was if a crime had been committed, it was important to discover who the persons were who made the wrongful decisions.”
Now Judge Rakoff is raising questions about executives at Bank of America, as well as the S.E.C.’s logic in imposing a $33 million fine on the bank. At a hearing Aug. 11, he said it appeared the bank had “effectively lied to its shareholders” about Merrill’s bonuses, which he said had been paid by American taxpayers, since the bank received a second bailout shortly afterward.
It's amazing that a judge who feels corporate entities should be responsible and accountable for their decisions ends up being news but look around. This place is a mess, of course this is news!
This is actually going to end up being far more interesting than it appeared to be at first glance. This Judge Rakoff guy = epic win.