Officials Demand Details of Bank of America Bonuses

Government wants report

U.S. Rep. Barney Frank on Monday said (see http://abcnews.go.com/Business/Economy/WireStory?id=7040710&page=2) Bank of America Corp. must provide more details on $6.9 billion in bonuses the company paid in 2008. Because the bank got quick loans from the government, officials say it must disclose who got what.

Bank of America accepted large amounts of bailout money, and Frank and others are saying taxpayers have a right to know the details of how the company is using its money.

Ordered to the court

New York Attorney General Andrew Cuomo has headed the fight to reveal the details behind the bonuses. The case wound up in state court. A representative for Bank of America said to the judge that the company would suffer “grave harm” if it had to reveal bonus data.  Bank of America said it would be an invasion of privacy, and it was worried that competitors would attempt to poach its staff members.

No longer a company

Bank of America bought Merrill Lynch last year as the company faced bankruptcy. Of the bonuses now on Bank of America’s budget sheets, $3.6 billion was awarded to Merrill Lynch executives before Bank of America bought out the company.

House Financial Services Committee Chairman Frank says the company must provide details on every bonus of $1 million or more. Bank of America has gotten $45 billion from the Troubled Asset Relief Fund.

Transparency

Barney Frank

Cuomo has been charged with assuring that all institutions that accept bailout money disclose their finances and make all bonuses and salaries public.

Cuomo is even trying to find out whether B of A broke securities law regarding public disclosure of executive pay. A New York state judge will hold a hearing March 13 to determine whether the company must disclose the information.