B of A's CEO sells his Porsche to CFO: Scandal or distraction?


Investigations into corporate scandals often start as genuine inquiries into a company's actions but end up becoming media circuses. That has finally happened at Bank of America (BAC). The judgment of Ken Lewis, the bank's CEO, has been questioned with regards to buying loss-plagued Merrill Lynch. There is the matter of whether bonuses at Merrill were too large and whether Bank of America senior management knew about them and let them go. Then, there is the question of whether Lewis should have disclosed pressure from Secretary Henry Paulson to close the Merrill Lynch deal in late 2008.

The latest piece of news about Lewis is that he sold his Porsche to his CFO in 2007. According to BizJournal, "Until now, the transfer of the car's ownership involving the two Bank of America executives has never been publicly disclosed. And while terms of the transfer remain private, corporate governance experts say the deal raises questions about ethics and independence."