ALBANY, N.Y. (Legal Newsline) - Not surprisingly, New York Attorney General Andrew Cuomo is upset that Merrill Lynch accelerated bonus payments to its executives before its deal to become part of Bank of America went through.
The Wall Street Journal reported that a person familiar with the matter said Cuomo will "examine closely the disturbing reports of what appear to be large, secret, last-minute bonuses."
Merrill Lynch and CEO John Thain gave billions of dollars to employees three days before the closing of its sale to Bank of America in December, the Journal has also reported.
Thain resigned Thursday from Bank of America.
The company announced last year that Thain would not get the $10 million bonus it was reported Merrill Lynch's Board was considering.
Cuomo has been critical of Wall Street investment firms that benefited from the recent federal bailout, arguing that taxpayer funds should not be used for executive bonuses.
"Utilizing Merrill's own criteria, a bonus of this size appears unjustified," Cuomo said in a letter to the company. "In terms of performance, Merrill has reported losses for every quarter this year and has lost more than $11 billion for the year as a whole.
"Indeed, Merrill's decision to be taken over by Bank of America seems to have been the only thing that saved Merrill from collapse. Clearly, the performance of Merrill's top executives throughout Merrill's abysmal year in no way justifies significant bonuses for its top executives, including the CEO."
Cuomo had also written the company on Oct. 29. He has pressured companies like American International Group, which recently announced it will limit its executive pay package and freeze the salaries of and eliminate bonuses for seven top executives.
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