Bank of America Corp. yesterday agreed to pay $131.8 million to settle civil charges that its Merrill Lynch unit misled investors in two mortgage-bond deals, the Wall Street Journal reported today. The settlement took the total sanctions paid to the Securities and Exchange Commission for alleged misconduct related to the 2008 meltdown to more than $3 billion. The SEC has ruled out enforcement action against prominent hedge-fund firms that helped banks create the complicated mortgage-bond deals that the hedge-fund firms then bet against, reaping profits on the wagers when the housing market collapsed. One of those hedge-fund firms, Magnetar Capital LLC, was involved in helping to create a number of deals that have been the focus of SEC cases, including Thursday's action against Merrill Lynch. The SEC said investors in the Merrill deals weren't warned that Magnetar had a "significant influence" in selecting the assets.
