Posted on Fri, Jun. 05, 2009
last updated: March 15, 2013 11:58:25 AM
Bank of America chief executive Ken Lewis will testify next week to a House committee that is examining the bank's purchase of Merrill Lynch.
Legislators want to know whether the U.S. Treasury and the Federal Reserve pressured Bank of America into buying Merrill. Lewis has previously testified that regulators, including then-Treasury Secretary Henry Paulson, threatened to oust him and bank directors if they didn't follow through with the Merrill deal. Lewis has also testified that he didn't reveal Merrill's accelerating losses last fall because Paulson, acting in synch with Federal Reserve chairman Ben Bernanke, told him the government didn't want any disclosure.
Paulson and the Federal Reserve have disputed Lewis' account, saying they didn't tell Bank of America what information it should reveal to shareholders.
The feud has prompted action from the House Committee on Oversight and Government Reform, which wrote to Lewis this week to ask him to appear before the committee next Thursday. The letter was signed by Rep. Edolphus Towns, a New York Democrat who leads the committee, and Rep. Dennis Kucinich, an Ohio Democrat who chairs one of the subcommittees. The bank declined to comment on the hearing, except to confirm that Lewis would attend.
Towns and Kucinich also wrote this week to Bernanke, asking his office to furnish copies of certain records related to the Bank of America-Merrill deal. The records, which the committee has previously reviewed, include e-mails sent between Bernanke and other top Fed officials.
Read more at CharlotteObserver.com