In-House Counsel

Congressman Wants to Know Why Bank of America Hired GC with Inactive License

A congressman investigating Bank of America’s purchase of Merrill Lynch wants to know why the bank ousted its general counsel last December and hired a replacement with an inactive license.

“This is another fact that leads me to believe there could be something rotten in the cotton,” U.S. Rep. Edolphus Towns, D-N.Y., told the New York Post.

The new general counsel, Brian Moynihan, had an inactive license for the first eight days after he was hired, according to stories in the Post, the Boston Globe and Corporate Counsel. Moynihan has been a bank executive, rather than a legal department lawyer, since 1999, according to Corporate Counsel. He served as general counsel for 37 days as the bank was reviewing the Merrill Lynch purchase.

Towns, chairman of the House Committee on Oversight and Government Reform, said he wants to know more. “In light of all the facts we now know, this is certainly worth a closer look,’’ Towns told the Globe. “What was the rush to fire the old lawyer and replace him with someone who apparently wasn’t even licensed to practice law?’’

Moynihan is now president of Bank of America and a candidate to replace CEO Ken Lewis. After his appointment as general counsel, Moynihan traveled with other executives to warn U.S. officials that Bank of America was considering canceling its acquisition of Merrill Lynch, according to the Globe. The former general counsel, Timothy Mayopoulos, told congressional investigators he concluded Bank of America had no valid legal reason to cancel the deal.

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