For Bank of America, a looming $50 billion headache
Bank of America's potential liability for bad mortgages - in the tens of billions of dollars - is well known. But Bank of America is haunted by other demons from the financial crisis. The most significant is a lawsuit arising from Bank of America's troubled Merrill Lynch acquisition. This lawsuit, brought by Bank of America shareholders, claims that Bank of America and its executives, including its former chief executive, Kenneth D. Lewis, failed to disclose what would be a $15.31 billion loss at Merrill in the days before and after Bank of America's acquisition. The plaintiffs contend that this staggering loss was hidden to ensure that Bank of America shareholders did not vote against the transaction.