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Friday morning, Bank of America (NYSE:BAC) announced it would settle a class action lawsuit brought in 2009 on behalf of investors who purchased or held Bank of America securities at the time the company acquired Merrill Lynch.
Shareholders accused the bank of making false and misleading statements about the health of the two companies; in particular, the plaintiffs accused Bank of America of hiding a major loss at the brokerage.
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While Bank of America denied the allegations, the bank agreed to settle in order to avoid further litigation. The terms of the settlement require the bank to pay a total of $2.43 billion and institute new corporate governance policies until January 2015, including majority voting in director elections and annual disclosure of noncompliance with stock ownership guidelines.
“Resolving this litigation removes uncertainty and risk and is in the best interests of our shareholders,” said Chief Executive Officer Brian Moynihan in a press release. “As we work to put these long-standing issues behind us, our primary focus is on the future and serving our customers and clients.”
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