(CN) - A federal judge in Manhattan barred Bank of America from using media reports to defend allegations that it tried to hide billions of dollars in bonuses to Merrill Lynch executives while accepting a $45 billion taxpayer bailout.
The Securities and Exchange Commission accused the bank of lying to investors about the $3.6 billion in bonuses paid to Merrill Lynch executives just before the companies' $50 billion merger in 2008.
Bank of America allegedly authorized Merrill Lynch to pay up to $5.8 billion in discretionary year-end bonuses, but issued a proxy statement telling shareholders that it had agreed not to pay the bonuses without the bank's consent. The bank argued that shareholders knew about the bonuses through the media reports.
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