(Adds bank to cover payment, comment from ex-CFO attorney)
By Karen Freifeld
April 25 Bank of America Corp's former
finance chief, Joe Price, has agreed to pay $7.5 million to
settle a New York lawsuit that accused the bank and its former
executives of misleading investors during the lender's
acquisition of Merrill Lynch.
Price also agreed to not serve as an officer or director of
a public company for 18 months, according to the settlement
The agreement ends the 2010 case against former Chief
Executive Kenneth Lewis, Price and Bank of America linked to the
2008 global financial crisis. The bank and Lewis settled with
New York Attorney General Eric Schneiderman last month.
New York accused the bank's executives of concealing
Merrill's mounting losses from Bank of America shareholders
prior to a Dec. 5, 2008 vote on the merger, and misrepresenting
the impact the merger would have on the bank's future earnings.
"This settlement is one more step in our effort to hold top
financial executives accountable for their actions,"
Schneiderman said in a statement.
The bank paid the $7.5 million for Price, according to his
attorney William Jeffress, who added that his client decided to
settle to because of the toll it was taking on him and his
"He has denied wrongdoing all along and still denies it,"
Lawrence Grayson, a spokesman for Charlotte, North
Carolina-based Bank of America, declined comment on the
Lewis agreed in March to pay $10 million to resolve claims
against him for misleading shareholders and the government in
order to complete the Merrill Lynch merger.
Bank of America agreed to pay $15 million to resolve its
portion of the lawsuit by Schneiderman, who inherited the case
from his predecessor Andrew Cuomo, now New York's governor.
All three payments are to cover the cost of the
investigation and prosecution, according to the settlements.
Neither the executives nor the bank admit wrongdoing.
A separate $2.43 billion shareholder class action settlement
won final approval last year.
The latest settlement was first reported by the Wall Street
The case is People v Bank of America Corp, et al, New York
State Supreme Court, New York County, No. 450115/2010.
(Reporting by Karen Freifeld in New York. Additional reporting
by Supriya Kurane in Bangalore; Editing by Gopakumar Warrier and