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John Thain Should Be Personally Liable For Merrill Lynch’s Losses

Tuesday, January 27th, 2009
Posted in Uncategorized by Joel Gross

Merrill Lynch was recently purchased by Bank of America.‚  Merrill Lynch had been hiding tens of billions of dollars in losses and now that Bank of America is responsible for those losses, BoA needs many, many billions of dollars from you (taxpayers) wallet.‚  Bank of America has now essentially been nationalized due to the scale of money the U.S. government has put into it.

So what did Merrill Lynch’s former CEO John Thain do in the final months leading up to closing the Bank of America deal.‚  Did he try to cut costs in every possible way?‚  Did he try to save as much cash as possible to help offset the massive losses his legal version of embezzling created?

Of course not: John Thain doesn’t have to worry about being held personally liable for Merrill Lynch and Bank of America’s losses- recent changes in the legal structure and in corporate structures have rendered corrupt CEO’s esentially immune from liability.‚  Since John Thain didn’t personally care what happened to Merrill Lynch’s shareholders or Bank of America’s shareholders, he gave over $4 billion in bonuses to his top executive cronies at Merrill Lynh.‚  Not only that but former Merill Lynch CEO John Thain spent $1.2 million redecorating his office during the last year while the company was laying off many employees.

The only way to prevent CEO’s from screwing over their companies is to make them personally liable for losses sustained at the company.‚  And don’t feed me the trendy crap that making these guys liable will stifle innovation- it will only stifle poor risk management and help keep sleazeballs like John Thain from profiting by screwing their own companies.