Tex ANDREW M. CUOMO STATE OF NEW YORK ERIC CORNGOLD some) Oe ; Executive Deputy Ate) Genera | OFFICE OF THE ATTORNEY GENERAL ective Depy Atomey Ge DAVID A. MARKOWITZ Bureau Chief Investor Protection Bureau (212) 416-8198 March 6, 2009 The Honorable Beard J. Fried New York State Supreme Court Justice New York State Supreme Court, New York County, Commercial Division 66 Centre Street, Room 248 New York, New York 10007 Re: People of the State of New York er al. vs. John A. Thain New York County Supreme Court 40038)-2009 Dear Justice Fried: We write, at the request of the Court, to respond to Bank of America’s March 5, 2009 letter in the above- referenced matter. In its letter, Bank of America seeks to expand the Court’s temporary confidentiality order, ich applies only to the testimony of John Thain, to all witnesses who have been subpoenaed in the Attorney General’s investigation, including an ex-employee of Merrill Lynch who testified yesterday - Gregory Fleming, First, the Attorney General disagrees with Bank of America’s contention that the information he is seeking in his investigation is of such a nature that, in the appropriate circumstances, the public is not entitled to Jean some or all of it. Bank of America makes an unfounded assertion of confidentiality even though it has no policy to protect the information, its employees routinely share their compensation with competitors when seeking new employment, and Bank of America regularly seeks and obtains detailed compensation information from its competitors’ employees. Moreover, as a TARP recipient, we believe Bank of America has an obligation to taxpayers to be open and transparent about bonus determinations. Indeed, Attorney General Cuomo is currently working closely on this issue with Congressman Bamey Frank, Chairman of the House Financial Services Committee, as well as other members of Congress. The Attorney General and Chairman Frank will shortly be sending a letter to Bank of America demanding that, as a matter of public policy, individualized bonus data be made public. In the instant matter, in an effort to accommodate the bank’s purported concerns, the Attorney General entered into a confidentiality agreement with Mr. Fleming, in the form regularly used by this office to protect ‘materials that are legitimately confidential. A copy of the confidentiality agreement is attached hereto as Exhibit A. 120 Bresway, New York, NY 10271 * Phone (212) 416-8222 * Fax (212) 416-8816In addition, in its application, Bank of America has neglected to mention a number of crucially important facts that render its application meritless: ‘Bank of America has, itself, unilaterally refused to comply with a subpoena calling for the information that is the subject to the instant dispute - a fist of recipients of mufti-miffion doflar bonuses that were awarded by the bank’s current subsidiary, Merrill Lynch, at a time Merrill was teetering on the edge of insolvency and were determined in a manner and at a time contrary to all precedent in the industry ~even under an agreement that it would be subject to the Court’s temporary order. Bank of America’s refusal to comply with the Attorney General’s subpoena, even under the Court’s protective order, is obstructing the Attomey General’s investigation. As a further effort to keep the subpoenaed information from the Attomey General, Bank of America threatened to sue its ex-employee, Gregory Fleming, to prevent Mr. Fleming from complying with a Javwfully issued subpoena and answering the questions properly put to him by this office. Bank of America is treating this matter as a commercial litigation between private parties. It is not. This is an investigation under New York's Martin Act, and Bank of America is now a subject of that investigation. Bank of America is seeking to prevent witnesses from testifying and is seeking to require advance notice of the Attomey General's investigative steps, which it is not entitled to do. As discussed above, the Attorney General’s Office has been in contact with various federal and state investigatory entities, as well as several members of Congress who are conducting parallel investigations and have, properly, requested a sharing of information so that these investigations can proceed expeditiously and efficiently. The confidentiality agreement which this office has entered into with Mr. Fleming permits these investigations to move forward, and, at the same time, provides more-than sufticient protection to Bank of America. Accordingly, in light of all of these circumstances, we respectfully request that the Court reject Bank of America’s continued efforts to stymie the Attorney General’s investigation, ee: Respectfully submitted, ATTORNEY GENERAL ANDREW M, CUOMO By: LEA! EL ~ David A. Markowitz Chief, Investor Protection Bureau 120 Broadway, 23rd Fioor New York, New York 10271 (212) 416-8198 Lewis Liman, Esq. (via email) Andrew Levander, Esq. (via email) Jonathan Polkes, Esq. (via email) 120 Broadway, New York, NY 10271 * Phone (212) 416-8222 * Fax (212) 416-8816