SEC Charging Bank Of America With Making False And Misleading Statements
Update: All is now taken care of - BAC settles with the SEC for $33 million, less than an hour after the suit becomes public. And... it's gone. The market ramp can now continue with commercial interruptions from the Federal Reserve of the United States.
Developing story: Apparently BAC screwed the pooch with misrepresenting the Merrill acquisition. Shocker. Will the SEC next pursue Hank Paulson and Ben Bernanke for enforcing this material misrepresentation? Mozillo's legal bill is already being footed by taxpayers, can we at least get a twoofer special here please?
From Bloomberg:
Aug. 3 (Bloomberg) -- Bank of America Corp. was sued by the U.S. Securities and Exchange Commission for allegedly making false claims about the purchase of Merrill Lynch & Co. in proxy statements. The SEC filed the suit in federal court in New York.
And this is the market's response:
(16 votes)
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on Mon, 08/03/2009 - 11:39
#23084
Yay! Throw Lewis under the bus!
on Mon, 08/03/2009 - 21:10
#23583
Sallie L. Kitecheck will take over and all will be forgotten.
on Mon, 08/03/2009 - 11:40
#23085
Wait, the SEC sues people? Since when?
on Mon, 08/03/2009 - 11:56
#23090
Hopefully this ends up being more productive than the Surpreme Court deciding that the SEC has no standing to bring the case, as per the Chrysler debacle.
edit: to clarify, i'm not blaming BAC for this, I'm just absolutely shocked at everything that has been going on lately.
on Mon, 08/03/2009 - 11:41
#23088
sounds like the left hand not knowing what
the right hand is doing....
this is tantamount to the government suing
itself....
on Mon, 08/03/2009 - 12:06
#23122
BAC settles the suit with the SEC already w/o admitting guilt.
both left and right hand are busy abusing the taxpayers, meanwhile the pooch continues to get screwed.....
on Mon, 08/03/2009 - 11:41
#23089
Does this mean they are gonna hang Lewis and let Bernanke and paulson off????
on Mon, 08/03/2009 - 16:54
#23447
Yes, hence the hasty simultaneous suit/settlement. At least they'll try to do it that way; does this settlement establish a basis for shareholder suits and discovery, or does it shut down discovery?
on Mon, 08/03/2009 - 11:44
#23093
I guess I have sympathy for the devil here, but we force them to swallow Merrill and then sue them for misrepresenting what pile of crap it was. Wonder why they were hesitant in the first place....
on Mon, 08/03/2009 - 12:16
#23136
Agreed, the real crime was that GS (maybe MS too) didn't have to eat a piece of shit like everyone else.
on Mon, 08/03/2009 - 11:45
#23095
Bernake, Paulson and Lewis all need to be in a prison cell with Maoff.
on Mon, 08/03/2009 - 17:06
#23452
Great foursome for some Tonk.
on Mon, 08/03/2009 - 11:46
#23097
Paulson/Fed/Goldman mandate the merger, now SEC attacks BAC? FUBAR.
on Mon, 08/03/2009 - 11:46
#23099
I used to think KL was the debbil hisself. Now I pity the man for having the fist of that hulking behemoth Paulson stuffed up his back-40. I imagine it must have hurt quite a bit.
Will this amount to anything, or will this (like everything else) end up somehow becoming a green shewt?
on Mon, 08/03/2009 - 11:47
#23101
This will teach Lewis a lesson...don't ever make a deal with the devil you always lose.
Also if CEO's don't think the administration will throw you under the bus and then back up and run you over again think again. So how many CEO's will this administation take out or blame as you can see the headlines of the next election brewing.....?
on Mon, 08/03/2009 - 12:22
#23143
B of A and Ken Lewis are not considered part of the real Wall Street.
If you have not seen this show it is worth a quick review.
http://www.pbs.org/wgbh/pages/frontline/breakingthebank/view/
on Mon, 08/03/2009 - 11:48
#23103
holy shiat, the BAC stock is going UP! LOLZ@this market.
on Mon, 08/03/2009 - 11:51
#23105
Reverse logic computer programs, just the usual that has driven this market to these mad valuation levels.
The bigger the loss the better, outlook uncertain and if you can add challenging, then buy buy buy buy as much as you can
on Mon, 08/03/2009 - 11:48
#23104
Not to worry, just get a few HFT to put a bid under it and all will be well again, still positive
on Mon, 08/03/2009 - 11:51
#23106
Shit Merrill down BAC's throat and then turn around and sue them...WTF!
on Mon, 08/03/2009 - 11:54
#23108
Colonial Bank is being raided in Orlando. FBI and the inspectors for TARP, I guess. Not the FDIC, though it should definitely force their hand.
Get ready for the "FDIC is out of money to secure your deposit" headlines. Then run to your bank...
(Fox Orlando has the headline, but not much detail)
on Mon, 08/03/2009 - 11:54
#23109
looks like the market (computers) love it
on Mon, 08/03/2009 - 11:55
#23110
What will the end result be? A 1 mil fine and a sternly worded letter at best?
on Mon, 08/03/2009 - 11:56
#23112
They will be given a 1 mill fine then get given 2 mill TARP money to pay it
on Mon, 08/03/2009 - 11:55
#23111
BAC stock up almost 4% after this news! Welcome to crazytown!
on Mon, 08/03/2009 - 12:00
#23117
I'm holding out for charge of triple homicide to get the 15% pop.
on Mon, 08/03/2009 - 12:05
#23121
WTF? BofA just settled one hour after the lawsuit was announced. They settled for $33 million. That was fast!
on Mon, 08/03/2009 - 12:10
#23124
$33 million is what they can find in their couch cushions. I'd call it a wrist slap, but "slap" may be too strong a word.
on Mon, 08/03/2009 - 13:30
#23219
The great part about it all is that they lied, and so they get "fined" $33 million, which is really just punishing the shareholders.
"How dare you invest in such a naughty company!"
Heads I win, tails you lose all over again...
on Mon, 08/03/2009 - 12:08
#23123
I think Mark Cuban was definitely in on this! Look for the Mavs to win the title next year!
on Mon, 08/03/2009 - 12:10
#23125
I can't get too excited about this because the best case scenario resembles a snake eating its own tale.
on Mon, 08/03/2009 - 12:13
#23130
Awesome! SEC takes almost a year to file charges when everyone was shouting fraud from the rooftops and then an hour later charges are settled for chump change. Just awesome!
on Mon, 08/03/2009 - 12:41
#23174
And Ken Lewis remains CEO.
on Mon, 08/03/2009 - 12:13
#23132
33 million?!...what was the point?
on Mon, 08/03/2009 - 20:03
#23531
Read the fine print. $33 million fine and Mary Shapiro gets that fine parchmnent waste basket from the Merrill executive suite and a coupon for a free interior design consultation using the Thain account. Nice commode.....
on Mon, 08/03/2009 - 12:14
#23135
The SEC got an immdiate Rahm phone call, after noticing that the spu's and bac didnt like the news.
"retract that fucking headline right fucking now."
chicago gangster politics dressed up as an eloquent black man.
on Mon, 08/03/2009 - 12:18
#23138
$3.6 billion in stolen bonuses for Merrill bankers.
$33 million fine.
Seems fair.
on Mon, 08/03/2009 - 12:31
#23156
Because charging BAC anything more would have forced them to reconcile the books and "discover" BAC's insolvency.
Must be some sort of $33 million asset sale to offset.
on Mon, 08/03/2009 - 12:19
#23139
More's the pity.. Smack his pee-pee.
on Mon, 08/03/2009 - 12:19
#23140
OT, but does anyone know what the "Story to Follow" crap is about over at Bloomberg?
on Mon, 08/03/2009 - 12:20
#23142
My favorite part "BOA admitted no wrong-doing". Don't you just love it when they say that after paying a large... well, in this particular case paltry... sum of money.
on Mon, 08/03/2009 - 12:36
#23166
Unbeleivable.
It's as if Paulson and Bernanke pressured BofA into making the deal with Merrill-- and in realizing (or Lewis pointing out) that doing the deal without telling investors about Merrill being in much worse shape than expected would be illegal, -- a big "out clause" for Ken Lewis was created out of thin air.
And, of course, that "out clause" is the SEC lawsuit that was settled immediately-- for a mere $33 million in hush money.
For the first time, I hope the sleazy class action lawyer community goes after BofA big time. Investors are getting screwed, and BofA still admits no wrongdoing.
on Mon, 08/03/2009 - 12:23
#23144
THEY BOUGHT THE DIP
I guess computerized trading programs dont watch TV
on Mon, 08/03/2009 - 12:24
#23145
NOW do you belive we are trading against computers.
http://gilco1.blogspot.com/
on Mon, 08/03/2009 - 12:24
#23146
Geez,
I thought is was "criminal" for a CEO to lie. What`s SOX good for anyways?
on Mon, 08/03/2009 - 12:25
#23149
I'll second that !
The SEC got an immdiate Rahm phone call, after noticing that the spu's and bac didnt like the news.
"retract that fucking headline right fucking now."
chicago gangster politics dressed up as an eloquent black man
on Mon, 08/03/2009 - 12:28
#23152
Resistance is futile.. (till robot rebellion blows one of those reactors.)
p.s. on the bright note, with all of those $ involved maybe humanity will finally comes up with an artificial intelligence :)
on Mon, 08/03/2009 - 12:31
#23154
Here's the URL given in the cnbc.com article linking to the SEC complaint:
"http://msnbcmedia.msn.com/iC:/Documents and Settings/501760196/Desktop/SEC v Bank of America Complaint.pdf"
Whoops.
on Mon, 08/03/2009 - 12:33
#23160
p.s. the coast is clear at the AIG west cost backoffice tower; (half of "their" space is vacant and 50% of peope working there were laid off, )
on Mon, 08/03/2009 - 12:33
#23161
"companies will be made to apologize with their money." -A Civil Action.
That said, this doesn't sound like an apology to me.
on Mon, 08/03/2009 - 12:33
#23162
Pop up the market with bad news, thats the plan.
It works.
on Mon, 08/03/2009 - 12:34
#23164
YO - feds raid Colnial: http://market-ticker.org/archives/1286-FLASH-FBI-RAID!-Colonial-Bank-Building,-Orlando.html
on Mon, 08/03/2009 - 12:37
#23167
Colonial Bank just raided by FBI agents.
on Mon, 08/03/2009 - 12:37
#23168
Getting charged by the S.E.C. is equivalent to getting slapped across the face with a turkey feather. What a joke...
on Mon, 08/03/2009 - 12:41
#23173
unless you are a small fish, then you are fudged...
on Mon, 08/03/2009 - 12:38
#23170
The bots are actually GI-Joes...
on Mon, 08/03/2009 - 12:39
#23172
FORBES HEADLINE: From coast to coast, unsold condos sit empty. In these spots, deals are likely aplenty.
(tell me, do people ever learn? who let the cash flows out, who,who,who,who - must be Denis...)
on Mon, 08/03/2009 - 12:42
#23176
Just wondering if the process server carried one of those little credit card swipers so that BAC could pay on the spot. It's nice to see that the American public, at least in congresspimp Lloyd Doggett's district, has had enough.
on Mon, 08/03/2009 - 12:57
#23188
Naa, they'll just run down to the BAC basement and grab the 33 million off a pile of TARP money.
on Mon, 08/03/2009 - 16:05
#23419
I love this...yes, paying the SEC fine with TARP dollars! What a joke!!
on Mon, 08/03/2009 - 12:45
#23177
This market doesn't even trade anymore
on Mon, 08/03/2009 - 12:47
#23179
So they basically paid them with taxpayer money, Whoopee life is sweet.
on Mon, 08/03/2009 - 12:48
#23180
Skynet already took over
on Mon, 08/03/2009 - 12:48
#23181
sign on the door of Citadel CEO:
my robot is better than yours,
that's right , it's better than yours
that's right, it's better than yours
on Mon, 08/03/2009 - 12:51
#23183
Hey Ty, you have such a high opinion of yoursel,f how does that jive with the fact that this blog has been 100% wrong for 5 months about damn near everything.
Large Money was made, but not by you. Nothing new there right.
on Mon, 08/03/2009 - 12:52
#23184
Market has yet to decide on the BAC news, still going sideways...
on Mon, 08/03/2009 - 12:56
#23187
Epic picture.
on Mon, 08/03/2009 - 13:04
#23195
SEC: Hey, you broke the law.
BOA: Here, have some of this money the Gov't paid us.
SEC: Thanks; no hard feeling bro.
BOA: *Hug*
SEC: *Hug*
on Mon, 08/03/2009 - 13:08
#23197
Not thirty-four or thirty-two. Thirty-three. These guys are great.
on Mon, 08/03/2009 - 13:12
#23200
$33 million is not a bad fine to U.S. taxpayers. Man, we got off scott free and didn't even have to admit to doing anything wrong!
on Mon, 08/03/2009 - 13:16
#23202
"The bank didn’t admit or deny wrongdoing as a condition of the settlement, the SEC said in an e-mailed statement."
This is the same crap that went on after the dot.om bust only worse at least then they had to pay the fine with thier money instead of the central bank handing it to them threw the back door.
There has to be a special place in hell for these greedy bastards one would hope.
on Mon, 08/03/2009 - 13:17
#23204
Breaking: U.S. Gov't accuses Federal Reserve of fraud and corruption. Seeks thirty-three quadrillion dollar fine. Anonymous sources say Bernanke-led Fed likely to acquiesce. National deficit problems thought to be permanently resolved. President quoted as saying "consuming is saving".
on Mon, 08/03/2009 - 13:24
#23211
I think Denninger is going to blow out today
on Mon, 08/03/2009 - 13:27
#23216
check out his posts .. the dude is in Howard Beale mode today
on Mon, 08/03/2009 - 13:42
#23230
How does this make any sense? The shareholder gets pooched twice and it's viewed as SOP. REALLY? This system is so screwed up...I can't even continue...in protest I'm holding my breath for 45 seconds! That's about as correlated of an action as the SEC's
on Mon, 08/03/2009 - 13:48
#23242
Fine will probably be paid with TARP monies. No big deal.
on Mon, 08/03/2009 - 13:56
#23254
This is not funny. It is outrageous! Clearly, bac, the sec, and ws think the coast is clear to rape the public again.
When will there be justice for the taxpayer and those cheated by ws?
on Mon, 08/03/2009 - 14:35
#23301
I'd be OK with this if KL had the decency to go door to door for donations.
on Mon, 08/03/2009 - 14:58
#23336
Do we still have the right to pass judgement on third world corruption ?
on Mon, 08/03/2009 - 15:39
#23396
> Geez, I thought it was "criminal" for a CEO to lie.
Silly you. Those rules about lying only apply to us, not the politically connected.