Bank of America CEO alleges a cover-up

Ken Lewis, embattled CEO of Bank of America (BAC), says that he was encouraged to keep problems at Merrill Lynch to himself. It is a convenient defense of what is viewed as a merger gone wrong, but it may be true nonetheless.

According to an exclusive report in The Wall Street Journal, "Federal Reserve Chairman Ben Bernanke and then-Treasury Department chief Henry Paulson pressured Bank of America Corp. to not discuss its increasingly troubled plan to buy Merrill Lynch & Co. -- a deal that later triggered a government bailout of B of A -- according to testimony by Kenneth Lewis." The reason Lewis was urged to stay silent was apparently concern that if the Merrill deal failed due to losses, it would cause panic in the financial markets.