It sounds like Federal Judge Jed Rakoff will definitely demand some changes in the proposed SEC settlement with Bank of America.
The judge read aloud pieces of Andrew Cuomo’s report during a hearing on the settlement today. He described the versions of the facts set forth as “strikingly different.”
He said he plans to further review the circumstances under which general counsel Timothy Mayopoulos left Bank of America, as well as the role of the bank’s law firm Wachtell Lipton Rosen & Katz LLP in deciding what to tell shareholders.
Rakoff also said he had “some questions” about the monetary component of the settlement, while other portions to improve the bank’s corporate governance and disclosure practices appeared “quite positive.”
Here’s the write up from the Associated Press:
A judge has put a Securities and Exchange Commission lawyer on the defensive over a settlement resolving civil charges that accused Bank of America of misleading investors when it acquired Merrill Lynch.
Federal Judge Jed Rakoff read aloud at a hearing Monday some of the critical language the New York Attorney General’s office used last week in bringing civil charges against the bank. He asked why the SEC didn’t see it the same way. An SEC lawyer said the SEC stuck to provable facts.
Rakoff must decide whether to approve the deal to pay shareholders $150 million. Last year, he rejected an earlier $33 million settlement stemming from the early 2009 acquisition.
He indicated he would not immediately decide whether the new deal was fair.
Image: thedartmouth.com (Elisabeth Ericson, The Dartmouth Staff)
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