Bank of America + Merrill Lynch = Federal Reserve???

Top Republican on the House Oversight and Government Reform Committee said on Wednesday that Federal Reserve intended to hide its involvement in BofA’s purchase of Merrill Lynch, which was in depression. As Representative Darrell Issa said the Fed "engaged in a cover-up and deliberately hid concerns and pertinent details regarding the merger from other federal regulatory agencies."

Democrats focused their attention on whether BofA's Lewis illegally misled investors about Merrill's finances. Republicans in their turn have focused on whether the Fed and former Treasury Secretary Henry Paulson inappropriately pressured Lewis to seal the deal. While lawmakers looked for someone to blame for the troubled deal, taxpayers worried about billions of dollars the government gave to banks trying to ease the world economic recession. In such a way the issue has become a political football.

Committee’s released documents revealed that the Fed found defects in audit conducted by BofA prior to the acquisition of Merrill. The committee has obtained a number of emails and documents from the Fed which show that the Fed tried to keep some information about the Bank of America deal secret from the Office of Comptroller of the Currency, the North Carolina-based bank's direct regulator, and from the Securities and Exchange Commission. Documents obtained by Republican panel members show that the Fed forced Bank of America to complete the deal by threatening to fire Lewis and the board.