March 12, 2009

Cuomo Catches Merrill Lynch Lying in Bonusgate Probe

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What has Andrew Cuomo done to deserve this disrespect from Bank of America and Merrill Lynch?

As we’ve previously noted, Cuomo, New York’s attorney general, is on the warpath against Bank of America, which swallowed up Merrill Lynch late last year with the help of billions of taxpayer dollars. Cuomo is peeved that Merrill Lynch doled out $3.6 billion in early bonuses even though it knew it was about to lose $15.31 billion in the fourth quarter of 2008. And now Cuomo seems to have caught Merrill’s lawyers in a lie. The Wall Street Journal reports:

In a Nov. 24 letter, a lawyer for Merrill Lynch & Co. assured the head of a House committee that “incentive compensation decisions for 2008 have not yet been made,” … But the firm’s compensation committee actually voted two weeks earlier to pay bonuses to Merrill employees in December, according to testimony from a Merrill director.

That sure looks like someone’s lying. And that’s not all. Depositions Cuomo filed with the New York Supreme Court yesterday indicate that, as Cuomo suspected, Merrill didn’t even think about reducing its bonus pool when it became apparent that it was going to suffer a steep loss. If Cuomo can continue to paint Merrill and Bank of America as irresponsible, lying scumbags, he’ll probably eventually get what he’s really after: the names of the employees that the two financial giants made into millionaires last year. The PR cost to B of A from his continued investigation will eventually become greater than the PR cost of releasing the names. But so far, B of A is still holding out on him.

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WHO DOESN’T LOVE A POSITIVE STORY—OR TWO?

“Great journalism really does make a difference in this world: it can even save kids.”

That’s what a civil rights lawyer wrote to Julia Lurie, the day after her major investigation into a psychiatric hospital chain that uses foster children as “cash cows” published, letting her know he was using her findings that same day in a hearing to keep a child out of one of the facilities we investigated.

That’s awesome. As is the fact that Julia, who spent a full year reporting this challenging story, promptly heard from a Senate committee that will use her work in their own investigation of Universal Health Services. There’s no doubt her revelations will continue to have a big impact in the months and years to come.

Like another story about Mother Jones’ real-world impact.

This one, a multiyear investigation, published in 2021, exposed conditions in sugar work camps in the Dominican Republic owned by Central Romana—the conglomerate behind brands like C&H and Domino, whose product ends up in our Hershey bars and other sweets. A year ago, the Biden administration banned sugar imports from Central Romana. And just recently, we learned of a previously undisclosed investigation from the Department of Homeland Security, looking into working conditions at Central Romana. How big of a deal is this?

“This could be the first time a corporation would be held criminally liable for forced labor in their own supply chains,” according to a retired special agent we talked to.

Wow.

And it is only because Mother Jones is funded primarily by donations from readers that we can mount ambitious, yearlong—or more—investigations like these two stories that are making waves.

About that: It’s unfathomably hard in the news business right now, and we came up about $28,000 short during our recent fall fundraising campaign. We simply have to make that up soon to avoid falling further behind than can be made up for, or needing to somehow trim $1 million from our budget, like happened last year.

If you can, please support the reporting you get from Mother Jones—that exists to make a difference, not a profit—with a donation of any amount today. We need more donations than normal to come in from this specific blurb to help close our funding gap before it gets any bigger.

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