U.S. District Judge Jed Rakoff said Monday that he will decide by the end of next week whether or not to reject the latest settlement between Bank of America (NYSE: BAC) and the Securities and Exchange Commission in regard to its 2009 acquisition of Merrill Lynch.  The settlement calls for Bank of America to pay $150 million in fines and penalties.

Bank of America and the SEC reached a $33 million agreement last year to settle the civil charges related to financial disclosures during the Merrill acquisition process.  However, Rakoff rejected that deal, calling it a “breach of justice.”

Judge Rakoff plans to give counsel for both sides a set of questions he would like answered, coming to a decision after they have been reviewed.  However, Rakoff already expressed that the new agreement would need some changes.

One of the items that would be touched is oversight of compensation practices.  For instance, Rakoff thinks there should be some kind of oversight on the bank’s decision when hiring a compensation consultant.

Rakoff did say that several changes in the new settlement in regard to internal governance structures were “quite positive.”

Rakoff plans to rule by Feb. 19.  If he rejects the new settlement, then a civil trial would begin on Mar. 1 in the case of the SEC vs. Bank of America.

In the SEC’s suit, it is claiming Bank of America misled shareholders by failing to disclosure pertinent financial information before shareholder’s voted on the Merrill deal.