The chairman to the bank Kenneth Lewis admitted that the information he gave out was not accurate. The executive of the bank, therefore, made mistakes that were against the ethics required in corporations (Cohen, 2009).
There are many decisions that the executive of the bank of America took that render them unethical. Among them includes the disguise by Merrill lynch on the risk involved. It was done by changing the “investment grade” to other investments referred to as the CDOs. The problem was further increased by the credit derivatives. It was because a person could trade the investments many times. It could only get understood by the professionals due to payments on mortgages being done in several years. The activities in the bank continued deteriorating in the prevailing days that loans begun defaulting (James et al., 2002).
Merrill lynch as indicated was not able to trade billions of the CDOs as if it had traded them, the players in the market had a chance of discounting the CDOs. The workers in the Merrill had the intentions of earning high bonuses continuously. as a result, they did not trade the CDOs. The employees did not indicate losses and later escaped with the lies. The accountants in the Merrill lynch failed to perform their duties and obligations. The problem raised alarms to the non professionals, however, the management allowed Merrill to escape with the funds. The bank of America acquired the Merrill lynch in the year 2008. A month later it was known that Merrill had losses that summed up to $15 billion. It was in the fourth quarter of the year and BofA made claims that the losses got incurred in December (Cohen, 2009).
The bank did not give information to the shareholders and moved on to putting $20 billion in TARP funds.