WASHINGTON — A House panel is likely to hold hearings into allegations made by Bank of America Corp. chief executive Ken Lewis that he was pressured to stay quiet about Merrill Lynch's weakening financial position last year, a top House Democrat said Wednesday.
House Financial Services Chairman Barney Frank, D-Mass., said he believed Rep. Dennis Kucinich, D-Ohio, would convene a hearing into the claims made by Lewis.
Kucinich is the chairman of the House Oversight and Government Reform Domestic Policy Subcommittee, which includes oversight of the Treasury and Federal Reserve.
A spokesman for Kucinich said no decisions had been made about whether to hold a hearing.
Tuesday, Sen. Richard Shelby, R-Ala., the senior Republican on the Senate Banking Committee, reiterated his call for the Senate to investigate the statements by Lewis. Shelby said he wasn't satisfied by comments by Fed Chairman Ben Bernanke Tuesday that he hadn't put any pressure on Lewis to stay quiet.
He said Senate Banking Committee Chairman Christopher Dodd, D-Conn., told him he would schedule a hearing into the matter.
Frank said he believed the allegations were more aimed at former Treasury Secretary Henry Paulson than at Bernanke.
Last month, New York Attorney General Andrew Cuomo revealed Lewis had testified under oath he had been pressured by Paulson and Bernanke to not inform shareholders of the true state of Merrill Lynch's financial position.
Bank of America was in the process of buying the investment bank, a transaction its shareholders had to approve.
Even more potentially damaging for Bernanke and Paulson, Cuomo said Lewis said he was told if he passed on the information to BoA shareholders, Treasury and Federal Reserve officials would seek to remove him and the entire BoA board.
The bank's shareholders voted to replace Lewis as chairman last week, although he will continue as its chief executive and president. The move sparked some analysts to suggest Lewis was on his way out of the bank.