New York Tries to Force Thain to Give Up Bonus Details
New York authorities are trying to force the former head of Merrill Lynch to provide details about $3.6 billion in year-end bonuses paid out to top executives just weeks before the firm announced it had lost billions more than it had previously projected.
John Thain, the ex-chief executive of Merrill Lynch, refused to disclose information to the New York attorney general's office during a deposition Thursday regarding individual bonus payments, citing advise from attorneys at Bank of America, which has merged with Merrill Lynch.
Thain's attorney, Andrew Levander, told prosecutors that he didn't want to have Thain "sued by the company for saying that he's violating someone's privacy," according to a transcript of the proceedings (partial transcript courtesy of MSNBC).
Thain also defended the payment of the bonuses, saying they were performance-based:
Bonuses were determined based upon the performance and the retention of people, and there is nothing that happened in the world or the economy that would make you say that those were not the right thing to do for the retention and the reward of the people who were performing.
Thain, 53, has been under scrutiny since New York Attorney General Andrew Cuomo began a probe into the approval of the year-end bonuses at Merrill Lynch, the New York investment firm that merged with Bank of America on Jan. 1.
The bonuses were set Dec. 8. Two weeks after Merrill Lynch's merger, the firm reported a $15.3 billion fourth quarter loss, resulting in an unexpected $7 billion hit on Bank of America. Thain was soon fired by Bank of America chairman and chief executive Kenneth D. Lewis.
By Derek Kravitz |
February 23, 2009; 6:06 PM ET
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Posted by: hemnebob | February 24, 2009 3:43 PM