Statement Of Congressman Brad Sherman: BofA Executives Victimize Shareholders, so S.E.C. Fines the Shareholders

Washington, D.C. - Congressman Brad Sherman, the most senior Democrat on the House Financial Services committee to have opposed the Troubled Asset Relief Program, reacted today to reports that the Security and Exchange Commission (S.E.C.) levied a $33 million fine against Bank of America (BofA) for keeping investors in the dark over billions of dollars of bonuses paid to Merrill Lynch bankers in the wake of a $50 billion merger with the Wall Street brokerage firm last year.

"The S.E.C. determined that Bank of America executives lied to Bank of America shareholders about $5.8 billion in executive bonuses. The executives lied. Shareholders were the victims of that lie. The S.E.C. solution: take $33 million from the shareholders.

"Not one penny is taken from the BofA executives who told the lies, or from the Merrill Lynch executives who got the $5.8 billion in highly questionable bonuses. The fine reduces the shareholders equity.

The fine is only .6 percent of the bonuses at issue – too small to force a change in the BofA management.

"The S.E.C. should be fining those executives who lied to shareholders in the Proxy statement and should prevent BofA from indemnifying those executives. Instead, under the crony capitalism enshrined on Wall Street, only a slap on the wrist will be administered – and it was imposed on the victims of the lie, the shareholders."