After months of deliberating and a growing dollar figure, Bank of America (NYSE: BAC) received approval from a U.S. District Judge on a $150 million settlement with the Securities and Exchange Commission, ending a drawn out lawsuit over actions during the Merrill Lynch acquisitions.
Judge Jed Rakoff, who previously shot down a $33 million settlement between the bank and SEC, approved a revised agreement that will keep the case from going to trial. The lawsuit was due for trial on March 1.
Rakoff approved the agreement provided the two parties produce a new draft for him by Thursday with the revisions that have been agreed upon.
The second suit alleged Bank of America misled investors in regard to Merrill Lynch bonuses, telling shareholders bonuses would not be paid out without Bank of America’s approval, which would be disclosed to investors.
However, more than $3.5 billion in bonuses were paid out to Merrill employees just weeks before the merger without the shareholders knowledge. Merrill reported losses in excess of $15 billion in that same quarter.
According to the agreement, Bank of America must implement and maintain a number of undertakings, including the contracting of a compensation committee consultant that meets super-independence criteria.
The bank’s CEO and Chief Financial Officer must also certify that they reviewed all annual statements and merger proxy statements.
Additionally, Bank of America must retain disclosure counsel, who will report to and advise the Board’s audit committee.
