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SEC and BOA Conspire to Trick Judge Rakoff

When two people pretend to be adversaries to commit fraud on a federal judge, a problem emerges: Keeping a bunch of lawyers "on message" ain't easy.  The SEC and Bank of America lawyers are going to learn this lesson, as Judge Jed S. Rakoff is not going to like their latest ruse.Here's the short story: Bank of America signed a contract to merge with Merrill Lynch.  BOA failed to disclose that the merger would cause BOA to face billions-of-dollars of losses; and require BOA to pay billions-of-dollars to the same morons at Merrill Lynch responsible for billions in losses.  Under securities laws, an acquiring company is required to disclose material facts about a merger to its shareholders.  Even post TARP, billions-of-dollars are material, right?After public outrage, SEC fined Bank of America - the company - $33 million...continue to full post

Full post as published by Crime & Federalism on September 09, 2009 (boomark / email).