BofA Knew of Merrill's $4B Bonuses

Private bonus agreement backs up Thain's claim that Bank of America was aware of payouts
By Rob Quinn,  Newser Staff
Posted Feb 3, 2009 7:02 AM CST
Then-chairman and CEO of Merrill Lynch John Thain speaks during a news conference in New York., Sept. 15, 2008.   (AP Photos/Bebeto Matthews, file)
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(Newser) – Ousted Merrill Lynch boss John Thain appears to have been speaking the truth when he said Bank of America knew all about Merrill's controversial December bonuses, the Wall Street Journal reports. A copy of a private bonus agreement obtained by the Journal shows that the two firms agreed on a combined bonus pool of $5.8 billion ahead of the bailout-funded takeover.

Rumors have swirled as to how much BofA knew about Merrill’s bonus plans before the takeover, and New York Attorney General Andrew Cuomo is investigating the deal. The agreement, however, states clearly that the "form and terms and conditions of the long-term incentive awards" were to be determined by Bank of America in consultation with Merrill.