WSJ UPDATE:NY AG Subpoenas Bank of America Directors -Source
(Updates to show Bank of America declined to comment and says Cuomo plans to
eventually subpoena entire board.)
By Liz Rappaport
Of THE WALL STREET JOURNAL
New York Attorney General Andrew Cuomo subpoenaed five Bank of America (BAC)
board members to testify under oath as part of his investigation into the bank's
purchase of Merrill Lynch & Co., according to a person familiar with the
investigation.
(This story and related background material will be available on The Wall
Street Journal Web site, WSJ.com.)
Cuomo is seeking to discover whether Bank of America directors withheld
information from shareholders. A Bank of America spokesman declined to comment.
Based on its investigation thus far, Cuomo suspects that the board was kept in
the loop on mounting losses at Merrill Lynch in early December, before the
shareholder vote on Dec. 5 to approve the merger between the two banks,
according to a person familiar with the matter.
Cuomo's investigators will ask directors how much they knew about Merrill's
losses and the role they played in decisions about disclosing information to
shareholders. That includes whether the board sought advice from counsel about
disclosure issues, said the person. They are also likely to ask board members
about pressure by government officials on disclosure issues, as well as whether
government officials threatened to remove management and the board if Bank of
America didn't proceed with the deal.
Cuomo's office plans to eventually subpoena all 15 board members present in
December, said the person familiar with the matter. The board's 16th member at
the time, Chief Executive Officer Kenneth Lewis, has already testified.
(END) Dow Jones Newswires
09-16-091418ET
Copyright (c) 2009 Dow Jones & Company, Inc.
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