Bank of America sued, settles with SEC over Merrill pay

Bank of America (BAC), one of the largest recipients of Treasury Department's bailout funds, disclosed today that it settled a lawsuit regarding its Merrill Lynch acquisition filed by the Securities and Exchange Commission for $33 million.

The SEC alleged that the companies made "materially false and misleading statements" about compensation agreements regarding Merrill employees, saying that the merger documents presented to shareholders stated no end-of-year bonuses would be paid out -- when in reality, $5.8 billion was slated to be distributed to executives. Merrill eventually paid out $3.6 billion in bonuses, despite losing $27.6 billion on the year.