Skip to main content

Today's Outrage: Bank of America's Convenient Excuse

Bank of America CEO Ken Lewis testified it's not his fault disclosure rules were ignored when troubles surfaced with the Merrill Lynch takeover. The government made him do it!
  • Author:
  • Publish date:

It's a convenient truth, to parody the one-time, almost-president Al Gore.

Bank of America


CEO Ken Lewis gets to blame former Treasury Secretary Henry Paulson for the abuse of shareholder trust during the

Merrill Lynch


acquisition. Lewis also pointed the finger at


Chairman Ben Bernanke for pressuring him to violate disclosure requirements and hide the growing troubles related to the takeover of Merrill Lynch.


passed the blame

for failing to alert shareholders about the surprise $15 billion loss Merrill reported just prior to being absorbed into Bank of America.

"It wasn't up to me," Lewis said in testimony to the New York attorney general in February, according to transcripts obtained by the

Wall Street Journal.

Maybe not. But following orders is no excuse for doing the wrong thing. And shame on our government for thinking that it's OK to subvert the rule of law when it is inconvenient. Maybe disclosing the truth about Merrill would have added to the crippling fear during that delicate period at the end of last year. But shareholders had a right to know.

To be fair to the Obama team, the Paulson role in all this falls on the administration of President George W. Bush. But Bernanke is still in the game. I'm not inclined to forgive him for doing wrong because he thought it was right. Wrong is wrong. Regulators who cross that line lose all credibility when they try to enforce the rules the next time.

Ever hear of the phrase public trust, Ben?

Anything we should know about the Bear Stearns and Washington Mutual purchases by

JPMorgan Chase


? How about the

Wells Fargo


takeover of


? Do I even dare to ask about




What other nasty secrets are locked in the vaults over at the Fed and Treasury offices? I'm sure the "janitors" are busy sweeping as much as they can under the carpets.

Best the we not know, apparently.

As for Lewis, it's awfully convenient that you got to package all those Merrill Lynch problems into that $15 billion loss


you completed the takeover. That certainly helped make your first-quarter numbers look good.

So please don't pretend you didn't have any vested interest in all this secrecy.

Shareholders will remember how sold them out.

So good luck at your annual meeting next week.

Hall is the editor of

. Previously, he served as deputy editor and chief innovation officer at

The Orange County Register

and as a news manager at

Bloomberg News

in Frankfurt, Amsterdam and Washington, D.C. As a reporter, he covered business and financial markets, worked in both print and television in the U.S. and Europe, and conducted in-depth investigative coverage at

The Journal-Gazette

in Fort Wayne, Ind. His work also has been published in a variety of newspapers including

The Wall Street Journal


The New York Times


International Herald Tribune

. Hall received a bachelor�s degree in journalism and political science from The Ohio State University and has taken graduate management science courses at Boston University.