Five Bank of America (NYSE:BAC) executives have been subpoenaed by New York Attorney General Andrew Cuomo as part of his investigation into the bank’s acquisition of Merrill Lynch, a source close to the investigation told the Wall Street Journal.
Mr. Cuomo’s office, which is seeking to discover whether BofA directors withheld information from shareholders, is expected to question the board members about what they knew regarding the mounting losses and the $3.6 bln bonus payments at Merrill ahead of the deal’s completion on January.
Cuomo’s investigators are also expected to ask about the role directors played in decisions about disclosing information to shareholders. That also includes, notes the Journal, whether the board sought advice from counsel about disclosure issues. The board members may also be asked if pressure was brought by government officials about the disclosure as well as whether government officials threatened to remove management and the board if Bank of America didn’t proceed with the acquisition.
It wasn’t immediately clear which directors received subpoenas, but according to the Journal’s source, Mr. Cuomo’s office plans to eventually subpoena all 15 board members present in December.