An internal disagreement within the Securities and Exchange Commission is threatening potentially lucrative revenue streams at Bank of America Corp., the Wall Street Journal reported today. The SEC is deadlocked on whether to allow Bank of America, which recently settled an SEC probe into flawed mortgage-backed securities, to continue selling shares in hedge funds and startups to wealthy investors. Also at issue is the company’s ability to quickly issue stocks and bonds without the speed bump of an SEC review. The bank was restricted as a result of SEC rules that automatically make firms ineligible from such activities if they violate securities laws. Bank of America has been seeking waivers since the $136 million settlement with the SEC, which was wrapped into a $16.65 billion deal with the U.S. government. The restrictions wouldn’t go into effect until a court finalizes the settlement, a step that has been delayed as the SEC fights over the waivers. Bank of America isn’t alone in seeking such waivers, as dozens of other large banks have sought — and received — the same waivers in recent months after settling SEC charges, including Citigroup Inc., Barclays PLC and Royal Bank of Scotland Group PLC.
