Bank of America reaches $137 million settlement with SEC News
Bank of America reaches $137 million settlement with SEC
Photo source or description

[JURIST] The US Securities and Exchange Commission (SEC) [official website] announced Tuesday that it had reached a $137 million settlement agreement [press release] with Bank of America (BOA) [corporate website] over fraud charges [order, PDF] for using anti-competitive bidding processes with 20 state municipalities. BOA has agreed to pay [press release] $36 million, including interest, to the parties harmed by the scheme, as well as $101 million in penalties to federal and state authorities. The order against BOA alleges that the company put at risk the tax-exempt status of the municipal securities by establishing fraudulent fair market values using “improper bidding practices” between 1998 and 2002. The settlement payments will include investigation fees for attorneys general in all 20 affected states. BOA emphasized that other companies are also under investigation and that it was the only company so far to self-report its fraudulent behavior to the Antitrust Division of the Department of Justice [official website].

BOA has been active in reaching settlement agreements with federal agencies. The SEC announced in September that a judge in the US District Court for the Southern District of New York [official website] had approved a $150 million fund [JURIST report] set up by BOA in accordance with the settlement agreement [JURIST report] reached earlier this year. The SEC had charged [JURIST report] BOA with misleading investors regarding billions of dollars paid to Merrill Lynch [corporate website] executives during the acquisition of the firm. The fund will be used for payouts to shareholders [Reuters report] who owned BOA stock as of January 16, 2009. In June, BOA subsidiary Countrywide Home Loans, Inc. reached a $108 million settlement agreement [text, PDF; JURIST report] with the Federal Trade Commission (FTC) [official website] to resolve charges that the subsidiary collected excessive fees from homeowners facing foreclosure. The agreement allows the FTC to create a fund to provide refunds to borrowers affected by Countrywide’s improper fees. The settlement did not include an admission of wrongdoing by BOA but required the company to stop the improper practices.

THIS DAY @ LAW

Ku Klux Klan founded

The US hate group known as the Ku Klux Klan was founded on December 24, 1865 in Pulaski, Tennessee as a reaction to reconstruction efforts following the Union victory in the American Civil War. The group would later become notorious for its attacks on Black Americans, being targeted by the Enforcement Act of 1871, which imposed civil and criminal liability for deprivation of constitutional rights. Read the Enforcement Act of 1871.  

Hamid Karzai born

On December 24, 1957, Hamid Karzai was born in Karz, Afghanistan. He would go on to become in 2004 his country's first elected president after the end of Taliban rule in 2001.