SEC To Review If Bank of America (BAC) Broke Any Laws

The SEC is reviewing whether Bank of America (NYSE: BAC) broke the law by not telling investors about Merrill Lynch’s plan to pay $3.6 billion in bonuses before they voted for a government-backed merger of the two banks, according to the Financial Times

Merrill paid the bonuses last December only days before it was purchased by Bank of America and actually entire month before bonuses were normally paid.

Bank of America's stance has been that it was not required to tell its shareholders about the bonuses.

Chairman of the SEC, Mary Schapiro, wrote a letter to a Democratic congressman that the regulator was "carefully reviewing the Bank of America disclosure" and had not yet expressed a view on whether the bonus plan should have been revealed.

However, federal securities law prohibits institutions from "omitting material facts" in connection to the purchase or sale of securities.

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