Read and weep: B of A investors kept in the dark

Secret Files: B of A Investors Not Told of Merrill's Huge Losses
Secret Files: B of A Investors Not Told of Merrill's Huge Losses

Written by Zack Smith - email

CHARLOTTE, NC (WBTV) - Bank of America's once-secret files continue to trickle out, along with new, even more damning evidence against top bank execs.

The latest documents show some board members may have actually taken the quote "screw the shareholders" approach to the Merrill Lynch takeover.  A new batch of executive emails, obtained by Bloomberg, show just how early B of A actually became aware of Merrill's mounting losses.

November 5th -- an email from the bank's Chief Accounting Officer.  Quote: "read and weep." The email estimated Merrill's losses through October at more than five-billion dollars.  That's important because that's a full month before B of A shareholders voted to green-light the deal. And yet the investors were kept in the dark.

Another email -- December 7th -- from Merrill's Chief Accounting Officer to Bank of America execs.  Three words: "What a disaster!" Attached to the e-mail were Merrill's financials through December 5th, the day of the merger.

Shareholders finally got that info in mid-December, around the 15th.  And by then Merrill's fourth-quarter losses had swollen to 15-point-8 billion dollars.

More top B of A officials will soon have a chance to explain who knew what and when they knew it.  Two bank board members, Chad Gifford and Thomas May, are about to testify before Congress.  Incidentally, these are the two guys who traded the infamous "screw the shareholders" emails, two weeks after the merger.

Stay tuned.  Their testimony is coming up tomorrow.