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So Why was BofA?s General Counsel Fired? Here?s BofA?s Answer

By Ashby Jones

All throughout BacMerSaga, it’s been a question raised by New York federal judge Jed Rakoff: Why was Bank of America’s former general counsel, Timothy Mayopolous, fired at the end of 2008? Might the rationale have been, as NY Attorney General Andrew Cuomo has implied, because he advised BofA executives to disclose bonuses to be given to Merrill Lynch executives, advice that the BofA brass didn’t like?

Actually, no, responded the SEC on Wednesday in a court filing in the SEC/BofA lawsuit. Mayopolous was fired strictly to create an opening for Brian Moynihan, who later succeeded Kenneth D. Lewis as chief executive, the SEC said. Click here for the Dow Jones Newswires story. Click here for past LB coverage of the situation.

Continued the SEC:

Mayopoulos was terminated in an attempt by Lewis to avert the imminent departure of the bank’s then-head of global corporate and investment banking, Brian Moynihan, by offering Moynihan the position occupied by Mayopoulos and upgrading the position to one that directly reported to the chief executive officer.

The court filing was made in connection with a $150 million settlement between Bank of America and the SEC over the bank’s disclosures before its acquisition of Merrill Lynch & Co.

Rakoff has repeatedly questioned why the SEC didn’t come to the same conclusions about Mayopoulos’s termination as New York Attorney General Andrew Cuomo, who has filed a separate lawsuit in state court in Manhattan.

At a hearing earlier this month, Judge Rakoff said that Cuomo’s lawsuit draws the inference that Mr. Mayopoulos was terminated because he wanted to disclose widening losses at Merrill Lynch before the deal closed.

Full post as published by Law Blog - WSJ.com on February 17, 2010 (boomark / email).