The Bank of America has agreed to pay 33 million dollars
to settle accusations by the US government
over billions of dollars of bonuses
paid out last year by its investment on Merrill Lynch.
Bank of America took over Merrill Lynch
to save it from collapse in a deal
backed by American taxpayers' money.
John Bithry reports.
Bank of America had promised its shareholders
that no bonuses would be paid to bankers at Merrill Lynch
without its express permission.
It's agreed to buy the struggling investment bank in September.
On the same weekend
that talks to save Lehman Brothers from collapse failed.
Like Lehman, Merrill Lynch was brought
to its knees by debt
links to the US housing market
that became toxic and lost its value.
But after Merrill was rescued by BOA,
it went ahead and paid its staff 3.6 billion dollars in bonuses anyway.
Shortly afterwards Bank of America
was forced to go to the government
for billions of dollars in extra taxpayer support,
and the revelation of the payments caused a public outcry.