Banking, finance, and taxes
Will Bank Of America (BAC) Take Congressional Request To Federal Court?
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Representative Edolphus Town, chairman of the House Committee on Oversight and Government Reform, has told Bank of America (BAC) that it cannot use attorney-client privilege when dealing with Congress.
It is a novel approach that probably does not hold an ounce of water legally. Town wants to know when B of A management found out about the huge fourth quarter losses a Merrill Lynch which it bought at the end of last year. A number of other federal and state agencies want to know the same thing.
Attorney-client priviledge is not going to disappear that easily and watch for Bank of America to file a motion in federal district court to preserve its rights.
If Congress can prevail in getting the bank to break the confidentiality bond, it will leave the door open for similar demands from state attorneys general like Andrew Cuomo and even investors who might file class action suits over the Merrill acquisition.
The courts won’t let Congress cross this line.
Douglas A. McIntyre
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