Bank's Stock Declines on WikiLeaks Anticipation
Bank of America Corp.'s stock dropped more than 3% Tuesday on speculation that website WikiLeaks would soon release internal documents.
The Charlotte, N.C., lender, the nation's largest bank as measured by assets. has been trying to determine for more than a year whether any documents were leaked from inside the bank, said people familiar with the situation. WikiLeaks founder Julian Assange asserted in an October 2009 Computerworld magazine interview that he had the 5GB computer hard drive of a Bank of America executive.
"We have no evidence that supports this assertion," a bank spokesman said Tuesday. "We are unaware of any new claims by WikiLeaks that pertain specifically to Bank of America."
WikiLeaks has gained world-wide attention for disseminating sensitive diplomatic documents. Mr. Assange told Forbes magazine that a release of "tens or hundreds of thousands of documents" in early 2011 would reveal "flagrant violations" and "unethical practices" at a major U.S. bank, according to the interview posted online Monday. He didn't name the institution, but at least one banking analyst pointed to BofA as a probable target in light of the earlier Computerworld interview.
The bank's shares closed at $10.95, down 36 cents, on the New York Stock Exchange.
Few financial institutions have been under more public scrutiny than Bank of America, with thousands of pages of emails, notes and sensitive regulatory conversations aired via congressional hearings and investigations.
The circumstances surrounding the acquisition of Merrill Lynch & Co. became the subject of several state and federal probes. New York Attorney General Andrew Cuomo has a civil fraud case pending against the bank, one of its executives and former Chief Executive Officer Kenneth Lewis. The suit alleges they misled investors about losses at Merrill before the acquisition closed.
In a separate lawsuit, the Securities and Exchange Commission alleged that the bank told investors the Merrill wouldn't pay bonuses before the deal closed without Bank of America's consent even though the bank had already authorized as much as $5.8 billion in bonuses. The SEC and the bank eventually settled for $150 million.
A WikiLeaks representative couldn't be reached via email. Asked in September 2010 if the organization had in fact obtained the hard drive of a Bank of America executive, this representative said via email, "I'm afraid I know nothing about this."
Write to Dan Fitzpatrick at firstname.lastname@example.org