BofA Covered Up Merrill Problems Under Orders From Bernanke & Paulson

Filed in National by on April 23, 2009

WSJ reports…

Federal Reserve Chairman Ben Bernanke and then-Treasury Department chief Henry Paulson pressured Bank of America Corp. to not discuss its increasingly troubled plan to buy Merrill Lynch & Co. — a deal that later triggered a government bailout of BofA — according to testimony by Kenneth Lewis, the bank’s chief executive.

Mr. Lewis, testifying under oath before New York’s attorney general in February, told prosecutors that he believed Messrs. Paulson and Bernanke were instructing him to keep silent about deepening financial difficulties at Merrill, the struggling brokerage giant.

Holy…

(h/t Bluehen Whisperer via tipline)

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Jason330 is a deep cover double agent working for the GOP. Don't tell anybody.

Comments (8)

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  1. jason330 says:
    April 23, 2009 at 1:07 pm

    The kos diarists on this point sout the following:

    (this testimony) all but implies that Bush Treasury Secretary Henry Paulson and Fed Chair Ben Bernanke “encouraged” (some might say: “conspired with”) him to commit securities fraud. Apparently, per reports at the time and as they relate to today’s story, the government-sponsored shotgun wedding between Merrill Lynch and Bank of America, engineered by Paulson and Bernanke back in the Fall of 2008, was rife with public misrepresentations and obfuscations about the (actual) dire financial condition of Merrill, and consequently, of the adverse impact it would have on BofA’s bottom line (and stock price).

  2. R Smitty says:
    April 23, 2009 at 1:10 pm

    Somehow, Lewis blaming this upwards doesn’t make me feel a bit better about Lewis.

  3. Unstable Isotope says:
    April 23, 2009 at 1:17 pm

    That BofA-Merrill deal was really screwed up. Lewis may be looking to save his own skin, but I think we should fire the lot of them: Lewis, Bernanke, hire back Paulson and fire him just for the fun of it, Summers and Geithner.

  4. cassandra_m says:
    April 23, 2009 at 1:39 pm

    If BoA’s shareholders are paying attention, they really should just fire him and sue him every which way from Sunday. Making M&A deals with representatives of the freakin’ government should be just the tip of the iceburg for securities fraud, I think.

  5. anonone says:
    April 23, 2009 at 1:46 pm

    hire back Paulson and fire him just for the fun of it

    funny.

  6. blue hen whisperer says:
    April 23, 2009 at 5:32 pm

    The letter that Cuomo sent to Frank, Dodd, the sec chairman has a bunch more juicy info. Explicitly says that Bernanke and Paulson were going to double team Lewis raw if he didn’t commit the securities fraud. What a moral dilemma: let the economic doomsday start with the fall of Merrill or force a CEO to commit securities fraud! Jesus! Umm how about I either throw a kitten at a moving train or give it cancer! Choices, hooray!

  7. Delaware Republican says:
    April 23, 2009 at 9:58 pm

    Was he waterboarded? If so, make sure you blame former VP Cheney also.

  8. R Smitty says:
    April 23, 2009 at 10:29 pm

    You want to hold office and that’s what you bring?

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