SEC sets new case vs. BofA

Bank of America has another lawsuit to fight from federal regulators.

The Securities and Exchange Commission’s latest filing accuses the Charlotte, NC-based bank of failing to tell shareholders about massive losses at Merrill Lynch before the two companies merged.

According to the regulatory watchdog, Merrill suffered losses amounting to about “one third of the value of the merger” between the deal announcement in Sept. 2008 and the shareholder vote two months later.

By the time investors approved the tie-up, BofA “had become aware of $4.5 billion in net losses that Merrill had sustained in October” as well as “billions of dollars of additional losses” estimated for November, the SEC said.

BofA spokesman Bob Stickler called the allegations “totally without merit.”

The SEC filed the suit after federal Judge Jed Rakoff nixed its plans Monday to add the allegations to an existing complaint accusing the bank of misleading shareholders about billions in bonuses paid to Merrill execs before the deal closed.