Thread: Bank of America gets subpoenas, reports SEC probe

This is one bank I could give a rats backside if it go's belly up

Bank of America gets subpoenas, reports SEC probe
Thu Aug 7, 2008 5:39pm EDT

NEW YORK (Reuters) - Bank of America Corp, the largest U.S. retail bank, said on Thursday it received subpoenas and requests for information relating to auction-rate securities from federal and state government agencies.

Separately, the Charlotte, North Carolina-based bank said Countrywide Financial Corp, the mortgage lending giant it bought last month, has responded to subpoenas from the U.S. Securities and Exchange Commission and faces a formal investigation by that agency.

In addition, Bank of America said it received subpoenas, interrogatories or civil investigative demands from a number of state attorneys general regarding municipal derivatives transactions from 1992 to the present.

Bank of America said it is cooperating with regulators. It disclosed the various matters in its quarterly report filed with the SEC.

Auction-rate debt has interest rates that reset through periodic auctions. Once thought safe, much of the market has been frozen since February, when Wall Street brokerages stopped supporting the debt.

Earlier on Thursday, Citigroup Inc agreed to buy back more than $7 billion of auction-rate securities and pay a $100 million fine to settle regulatory charges that it fraudulently misled investors about the debt's risk. Other financial companies have also faced regulatory inquiries or charges.

Countrywide, meanwhile, is also under investigation by the FBI, authorities have said. The FBI last month said it had 21 corporate targets in its investigation of potential corporate fraud in the mortgage industry.

California, Connecticut, Florida and Illinois have all sued Countrywide over its lending practices.

Separately, Bank of America said it has bought $525 million of assets this quarter as part of a restructuring of a structured investment vehicle, in a bid to support some money market funds at its Columbia fund unit.

It expects other SIVs to be restructured and this could result in further losses.

Bank of America shares closed down $1.93, or 5.8 percent, at $31.52 on the New York Stock Exchange. They have fallen 24 percent this year.

(Reporting by Jonathan Stempel; editing Carol Bishopric and Andre Grenon)

http://www.reuters.com/article/governme ... 7720080807

As a resident of NC, I care very much that the tallest building in the state and the 76th tallest in the world will be vacant.

Added to BOA site