Hi, there. I’m Grove O’Rourke back from the pages of Top Producer and my firm, Sachs, Kidder, and Carnegie. You probably saw my post earlier this week on investment fees. Over the next few weeks, I’ll blog regularly and suggest topics for clients to hash out with their financial advisers.
In the meantime, I’d like to discuss Bank of America’s deal with the SEC. The New York Times reported that the bank agreed to pay $33 million to settle charges related to “false and misleading statements to shareholders about bonuses promised to Merrill employees.” Subsequent to the agreement, a federal judge refused to allow the settlement. He reasoned it might be unfair to Bank of America’s shareholders.
Talk about Acrimoney.
Does it bother anyone other than me, and remember I’m a fictional character, that one realm of the government is suing a firm that another realm bailed out? The judge skirted the edges of this irony:
“The proposed consent judgment would leave uncertain the truth of the very serious allegations made in the complaint,” Judge Rakoff wrote in his two-page order.
He also said the deal “in no way specifies the basis for the $33 million figure or whether any of this money is derived directly or indirectly from the $20 billion in public funds previously advanced to Bank of America as part of its ‘bailout.’ ”
No matter Judge Rakoff’s ruling, Uncle Sam bailed out Bank of America. And money is fungible. In other words, cash raised for one purpose can easily be used for another. So as I see it, the SEC is indirectly suing taxpayers who indirectly funded Bank of America. You can’t make this stuff up.
Maybe we need a US Czar of Hand-Eye Coordination.
The New York Times describes my novels as “money porn,” “a red-hot franchise,” and “glittery thrillers about fiscal malfeasance.” Through fiction I explore the dark side of money and the motivations of those who have it, want more, and will steamroll anybody who gets in their way.