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Bank Of America's Fraudulent Acquisition Of ML Back In The Congressional Spotlight Tomorrow
Tomorrow at 10 am the House Oversight Committee will hold a hearing with SEC's Robert Khuzami (oddly Mary Schapiro, together with Chris Cox, had been scheduled to appear initially, however "in a series of last minute negotiations, members settled on Khuzami") to discuss what the SEC has already found to be a criminal transaction (and attempted to promptly bury under the rug if only if it weren't for one Judge Jef Rakoff). Details of the hearing below:
Washington, DC – House Oversight and Government Reform Committee
Chairman Edolphus “Ed” Towns (D-NY) and Domestic Policy Subcommittee
Chairman Dennis Kucinich (D-OH) will convene a joint hearing entitled:
“Bank of America and Merrill Lynch: How Did a Private Deal Turn Into a
Federal Bailout? Part V?” The hearing will examine the events
surrounding Bank of America’s acquisition of Merrill Lynch and its
receipt of Federal financial assistance.The hearing will
take place at 10:00 a.m. on Friday, December 11, 2009 in room 2154
Rayburn House Office Building. A webcast of the hearing will be
available on the Committee’s website: http://oversight.house.gov.
As for the actual hearing, Dow Jones presents this advance look of how Dennis Kucinich will approach the interrogation:
[Kucinich] plans to present Khuzami with a financial forecast
that had been prepared by Merrill Lynch a few weeks ahead of the December 2008
shareholder vote on the merger, according to subcommittee documents obtained
by Dow Jones.
The forecast omits projected losses from Merrill Lynch's illiquid assets for
the month of December and underestimates by almost half the roughly $15
billion after-tax fourth quarter loss, the documents say.
Based on the subcommittee's investigations, Kucinich says he believes Bank
of America executives were aware of the red flags raised by Merrill Lynch's
forecast. But that didn't stop them from presenting the document to their
lawyers at Wachtell, Lipton, Rosen & Katz.
Kucinich says Bank of America's decision not to investigate the Merrill
Lynch document and notify shareholders of any change in expectations amounts
to "an egregious violation of securities laws."
Referring specifically to the Merrill Lynch forecast, [BofA spokesman Lawrence] Di Rita said, "The
matter of Merrill's projected fourth-quarter 2008 losses was considered
carefully and the decisions were made in good faith at a time of unprecedented
economic and market upheaval."
And while committtee chairman Edolphus Towns is allegedly satisfied with BofA's behavior in the last year, "since it paid the last of its $45 billion debt to taxpayers" even though it does not have the ready sources for this outflow, and even though the deal was merely a front to allow BofA traders to scalp exorbitant bonuses one last time before everything collapses, Judge Rakoff may not share Towns' utter lack of interest with due process and punsihment of criminal behavior, especially where said criminal behavior has already been proven.
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"...coming soon to a publicly accessible courtroom near you."
Is that going to be on pay-per-view?
Just another Charade. As long as it dosent inerrupt Regis and Kelly
So WILL HE or WILL HE NOT squeal on Hank Paulson? I think the trial will coincide with Paulsons' book release (the book about how he and Neel "HatchetJack" Kashkari saved the world).
The funniest bit was when the WSJ changed Lewis's picture ...
Makes me wonder.. do they have a Plan B pic for every top dog?
http://anonymousmonetarist.blogspot.com/2009/01/liar-liar-stocks-on-fire.html
Apprently Kucinich didn't get what he wanted from Mr. Lewis during their last tête à tête.
Don't get hopes up on Rakoff. Remember that
Rakoff (and Richard Breeden acting for the
SEC) are STILL sitting on the last chunk of
the Worldcom Victim Trust.
Sure they will raise the temperature a little
and squeeze some more out of them. That will
be the end of the story.
OT, but TD, we can't get that Prime Jumbo ABX index soon enough.
Just a few downgrades today, and these are pre-2005 deals, imagine how the post-2005 deals are performing?
Trust me, these won't be the last.
S&P Cuts 1,862 Ratings On 416 U.S. Prime Jumbo RMBSDecember 10, 2009
Standard & Poor's cut its ratings on 1,862 classes of RMBS backed by prime jumbo mortgages issued from 2002 through 2004.
The rating agency said projected losses because of increased delinquencies are expected to be greater than the amount of collateral.
Jumbo loans, issued to homeowners needing at least $417,000 in financing, have seen a sharp rise in delinquencies. However, the total delinquency rate remains sharply lower than those of other types of loans.
The downgraded classes are from 416 RMBS deals. S&P also affirmed the ratings on 4,390 classes from 414 transactions.
Ghost....clearly you are on top of this area as I have been reading closely your comments.
Firstly, thank you for sharing your expertise and insights.
Secondly, I certainly hope you continue to do so as the housing messing continues down the timeline.
Perhaps you can submit more extensive pieces to ZH as a contributor or guest post?
Again, thank you very much.
any way to at least split the numbers from the dead zone (zona, cali, FL, NV) and the rest of the states?
that can paint a better picture of this oil spill
Yeah, what about the FDIC's fraudulent seizure of WaMu? Too bad the massive lawsuits will take so long to play out but eventually Bair, Dimon, Paulson will come out smelling like rotting carrion.
http://www.portfolio.com/industry-news/banking-finance/2009/12/07/why-fe...
And what I am particularly angry about is the decision made by ML senior executives to allocate more than $1 billion in discretionary bonuses, which were heavily allocated to the same senior staff, which were accelerated so they were paid out in December, ahead of the writedowns. These payments should be reclaimed, or they should be thrown into jail...
Didnt Hank Paulson force Ken Lewis into going thru with the Merrill deal? Did I waste an hour of my life watching it unfold on "Frontline"??? PBS doesnt lie.
http://anonymousmonetarist.blogspot.com/2009/04/leverage-is-dirty-business.html
LEWIS
Bene. Don Paulson. I need a man who has powerful friends. I need many billions of dollars in cash. I need, Don Paulson, those regulators that you carry in your pocket, like so many nickels and dimes.
Can we pass the hat around to buy a kevlar vest for Kucinich ?
Yes. Yes. It was definitely “criminal.” But the criminal was not Kenneth Lewis. The “criminal takeover” was in the minds and action of government officials, acting against the interests of the American taxpayers and Lewis was caught in the crossfire. Lewis may be guilty of failure to protect his stockholders, but the big crime was committed by government officials. The true criminals are not on the dock.
This is typical Yom Kippur (scapegoat) justice; the Bernankes and Paulsons and Rubins, the perpetrators of securitization fraud--the pooling, repackaging, and selling to investors and now the defaults and chain reactions and bailouts --will go free, to rob again.
“Justice being taken away, then, what are kingdoms but great robberies? For what are robberies themselves, but little kingdoms?” –St. Augustine: The City of God, iv.
This seems odd to have this hearing at this time. The two things I know the least about are investing and law. But, is this testimony going to be a part of discovery in the upcoming trial? Will anything this guy says going to be prohibited from being a part of the trial? What can this guy tell a couple of congressional fools that they do not already know and will be confirmed at the trial?
What about if queen bee states at the trial that Khuzami is a fruitcake and his statements were false?
Here ye, Here ye!
Law and order in the court! The Honorable Judge Jed Rakoff presiding!
Will Judge Rakoff be another Judge Sirica?...another Time magazine Man of the Year?
"Sirica's involvement in the case began when he presided over the trial of the Watergate burglars. He did not believe the claim that they had acted alone, and persuaded or coerced them to implicate the men who had arranged the break-in. For his role in Watergate the judge was named TIME magazine's Man of the Year in 1973."
http://en.wikipedia.org/wiki/John_Sirica
I hope this is only the first of many Wall Street cases that the good Judge Rakoff will preside over. I hope that Judge Rakoff, like Judge Sirica, will follow the money, and unravel the Wall Street criminal enterprise that is gravely damaging the Nation. Godspeed Judge Rakoff!
BOA's lawyers will defend Lewis until he wins an appeal, if it comes to that. He will win appeal eventally. The conservative Supreme Court especially since Roberts have established these principals.
1 Individual executives of corporations are not liable for the actions of those corporations.
2 Corporations are not responsible for the actions of the excecutives of those corporations.
what if... Lewis cracks ....
and if he does, did GS hedge for it ??? is there anything they aren't frontrunnin?