SEC Going to Trial Against BofA over Bonuses

WASHINGTON (AP) -- The Securities and Exchange Commission says it plans to go to trial against Bank of America over billions of dollars in bonuses paid at Merrill Lynch.

The SEC says it will "vigorously pursue" its case against Bank of America, opening the possibility that bank executives could also face charges.

In turn, the bank says it will "vigorously defend" itself.

Monday's SEC announcement came after a federal judge last week threw out a $33 million proposed settlement of the case.

The agency has accused BofA of failing to disclose to shareholders that it had authorized Merrill to pay up to $5.8 billion in bonuses to its employees in 2008 even though the investment bank lost $27.6 billion that year.

Separately Monday, Bank of America reached an agreement with the government to exit an arrangement under which public funds might have been used to shoulder losses on risky assets from the Merrill Lynch takeover.

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