Bank of America issue gets political in Florida

By John O'Brien | Feb 9, 2010


TALLAHASSEE, Fla. (Legal Newsline) - Florida Attorney General Bill McCollum's office was confused by a recent request from Chief Financial Officer Alex Sink, while his campaign office was outraged.

Sink, a Democrat who will likely face McCollum in the general election for governor this year, said Monday that she wants McCollum to be more aggressive in litigation against Bank of America and other financial institutions. Bank of America is facing lawsuits regarding its merger with Merrill Lynch.

Sink was Bank of America's former President of Florida Operations and had been called a protege of Kenneth Lewis, the company's former CEO who was sued Thursday by New York Attorney General Andrew Cuomo.

McCollum campaign spokesperson Kristy Campbell said Sink is using her office to distance herself from Bank of America.

"It is hugely inappropriate," Campbell said. "She is clearly attacking McCollum for political purposes from her official office, which is funded by taxpayer dollars.

"It is inappropriate. It borders on unethical. It is something she'll have to answer for in November."

Sink spokesperson Kyra Jennings said Sink merely wants Florida, the fourth-largest state in the country, to take a more active role litigating against the financial industry.

"She has a responsibility to be concerned about Florida and its citizens," Jennings said.

Bank of America is alleged to have misled its shareholders about Merrill Lynch's financial situation and plan to pay hundreds of millions of dollars in executive bonuses before they voted on the merger.

Cuomo also said the company misled the federal government into giving it Troubled Asset Relief Program funds, while a Wall Street Journal opinion piece said Cuomo's policies as Secretary of the Department of Housing and Urban Development helped cause the subprime mortgage crisis.

Sink, though, is blaming Bank of America and applauding Cuomo while calling out McCollum in a press release Tuesday.

"Floridians have lost untold millions because of suspected financial fraud, and any financial institution that misled our citizens must be held accountable," she said.

"Though that seems obvious to every Floridian, so far the Attorney General, the Office of Financial Regulation, and the (State Board of Administration) have failed to take significant action on behalf of the people of Florida."

Sandi Copes, a spokesperson for McCollum, said the SBA -- made up of McCollum, Sink and Gov. Charlie Crist -- is already trying to become a member of a class headed by two Ohio pension funds and a Texas pension fund.

Law firms approved by the SBA to represent the State in securities suits are representing other plaintiffs and are co-lead counsel in the suit.

Monday, McCollum asked Office of Financial Regulation Commissioner Thomas Cardwell about the possibility of a fraud suit by the OFR. Prior to a law that passed last year, the department had the sole authority to pursue securities fraud suits.

Bank of America's alleged actions occurred when the OFR had that authority.

A St. Petersburg Times report said Sink scolded Cardwell Tuesday at a Cabinet meeting, while Cardwell said enough is being done already.

From Legal Newsline: Reach John O'Brien by e-mail at

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