NEW YORK attorney general Andrew Cuomo subpoenaed seven people yesterday who received bonuses at Merrill Lynch, said a person familiar with the matter.
Mr Cuomo is investigating $3.6 billion in bonuses given to Merrill employees just before the firm merged with Bank of America on January 1st. Former Merrill chief executive John Thain and Bank of America chief Kenneth Lewis previously testified in Mr Cuomo’s office about the bonuses. The executives will be asked about their bonuses, their communications with Mr Thain and the timing of the bonuses, the person said.
The person said yesterday that the seven bonus recipients subpoenaed were Andrea Orcel, David Sobotka, Peter Kraus, Thomas Montag, David Gu, David Goodman and Fares Noujaim.
The Wall Street Journalyesterday published the names of top executives and their 2008 earnings, citing documents and people familiar with Merrill's compensation. Eleven top executives were paid more than $10 million in cash and stock last year, it said.
In a petition filed on Wednesday, Bank of America said it could suffer “grave harm” if forced to reveal data about the bonuses. The bank urged Justice Bernard Fried to reject Mr Cuomo’s demand. Bank of America said revealing the data could help rivals poach talent, prompt employees to leave because their privacy was violated, cause “internal dissension”, increase security risks for bonus recipients, and give rivals a better idea of which businesses it values most.
Mr Cuomo is investigating whether the bonuses violated securities laws. A hearing is scheduled for March 13th. – (Bloomberg/Reuters)
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