Bank of America failed to disclose ’staggering financial losses’ to shareholders

Federal regulators sued Bank of America Corp. on Tuesday, accusing the company of failing to disclose "staggering financial losses" at Merrill Lynch before shareholders approved a combination of the companies.

The lawsuit filed by the Securities and Exchange Commission in U.S. District Court in Manhattan sought an order requiring Bank of America to pay a civil penalty for not telling shareholders it was losing $15.3 billion in the fourth quarter of 2008.

Bank of America spokesman Robert Stickler called the charges "totally without merit."

He said the company believes it provided sufficient and appropriate disclosure to shareholders prior to their vote approving the combination.

"We look forward to presenting the facts in court," Stickler said. "What we would note is that there were no charges against individuals and no charges of fraud. We were pleased with that."