Change To Win Calls On Congress To Rein In $3.6 Billion Merrill Lynch Bonus Payments

March 20, 2009 -- WASHINGTON, D.C. – Change to Win called on Congress today to amend the critical tax legislation to recover the unwarranted and outrageous bonuses to failing managers of AIG and other bailout recipients to include the $3.6 billion in bonuses Bank of America allowed Merrill Lynch to secretly pay in advance of its merger.

“The Merrill Lynch bonus pool is one of the most egregious bonus fiascos on Wall Street,” said Change to Win chair Anna Burger. “American taxpayers are tired of repeatedly seeing corporate excess rewarded, but adding insult to injury, they are now being asked to reward corporate failure. Enough is enough.”

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“It’s time for Congress to put an end to these atrocities and instead work to help restore the economy, rebuild the middle class, and renew the American Dream for America’s workers instead of supporting the lavish lifestyles of greedy corporate managers.”

The tax legislation that passed the House on Thursday imposes a 90 percent surtax on bonuses granted to employees who earn more than $250,000 at companies that have received at least $5 billion from the government financial rescue program, also known as TARP. The bonus tax, if passed as is, would be retroactive to December 31, 2008, leaving the Merrill bonuses out of the scope of the law.

As the result of a secret Agreement uncovered by N.Y. Attorney General Andrew Cuomo, Bank of America, which had already agreed to acquire Merrill Lynch, was complicit in Merrill’s plan to secretly pay $3.6 billion in bonuses before year end. Merrill normally pays bonuses in January. Moreover, Bank of America had already received $25 billion in TARP funds at the time of its complicity in the Merrill bonus payments, and subsequently received another $20 billion in TARP funds expressly as a result of Merrill’s rapidly deteriorating financial condition.

“It is absolutely obscene for those most responsible for our nation’s financial crisis to walk away with millions of dollars in bonuses while America’s hard working families struggle to pay their mortgages, health insurance, and children’s education,” continued Burger.

Source: Change to Win