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One of Congressman Peter Roskam’s big camapaign donors, Bank of America, was all over the news today. They made news for three reasons:
- It was revealed yesterday that Bank of America will be paying it’s investment banking employees bonuses totaling approximately $4.4 billion – an average of about $400,000 for each employee receiving a payment.
- New York Attorney General Andrew Cuomo filed a civil lawsuit against former Bank of America CEO Ken Lewis and former CFO Joseph Price, accusing them of lying to shareholders and extorting the federal government surrounding its acquisition of Merrill Lynch in 2008. The allegation is that in order to complete its deal, Bank of America’s management misled its shareholders by not disclosing massive losses that were mounting at Merrill Lynch so that the shareholders would vote to approve the deal. Once the deal was approved, Bank of America’s management manipulated the federal government into saving the deal with billions in taxpayer funds by falsely claiming that they intended to back out of the deal through a clause in the Merger Agreement. You may recall that just before the deal went down, Merrill Lynch paid out a staggering $3.57 billion dollars in employee performance bonuses, even though the company was failing. You may also remember that Ken Lewis received a $64 million retirement package when he left the company for a job well done. After the deal, B of A received a $45 billion bailout arranged by the Bush administration.
- A Senate report report released today suggested that, despite money laundering regulations, corrupt foreign officials are still able to move “dirty” money into U.S. financial institutions. Bank of America was specifically cited for not having raised questions about movements of funds by a corrupt Angolan arms dealer now imprisoned in France.
All of this really makes me really angry.
Bank of America is a publicly traded company. That means that your 401K and mine have money invested in the bank. So when the bank pays out obscene bonuses to its executives, that money comes out of funds that would otherwise enrich the shareholders, that is, you and me. When the bank performs poorly, the bankers still get bonuses, our 401K gets the hit, and we have to pay to clean up the mess. On top of that, the Bank seems to think it is above our laws regarding money-laundering. If they get into criminal trouble on that account, we’ll be paying that bill too.
Bank of America is a significant contributor to Peter Roskam’s campaign and to his leadership PAC. They don’t give him that money out of the goodness of their hearts. They want something back, and, in my estimation, they get it. Roskam is a fierce opponent of bank regulation, even after the worst financial collapse since the Great Depression. And he opposes the kind of financial tranaction tax supported by the Obama administration as well as consumer protections that protect you and me from the banks’ predatory practices.
Well, I think it is unseemly that Peter Roskam is getting money from B of A, and I think he ought to give it back. But don’t hold your breath.
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Yet it is okay that his opponent’s have traditionally taken a lion’s share of their donations from unions. Remember that unions only represent a very small share of voters, and half of the employees of the unions are government workers. Using your logic, Roskam’s opponents must have been in the pocket of the unions, which was probably true.