Merrill Lynch & Co. employees may have written down its holdings after their bonuses for last year were set, leading to losses that were larger than expected, New York Attorney General Andrew Cuomo said.
"Less than a week after Merrill voted its premature bonuses, Merrill determined that it would incur an unexpected additional $7 billion in losses for the fourth quarter of 2008, beyond the $8 billion it was already anticipating," Cuomo said Wednesday in papers filed with the New York State Supreme Court. "It appears that some of these losses may have been booked by Merrill employees who marked down their portfolios only after their 2008 bonuses were set."
The papers were filed in opposition to Bank of America Corp.'s motion to intervene in an investigation of the Merrill bonuses and to stop public disclosure of who received the bonuses and how much they got. B of A acquired Merrill in January.
