WASHINGTON (AP) — Former Treasury Secretary Henry Paulson will testify next month before a House committee that's investigating whether he and other government officials pressured Bank of America Corp. to acquire Merrill Lynch in a deal that cost taxpayers $20 billion.
The House Oversight and Government Reform Committee has scheduled the hearing for July 16, and a spokeswoman for Paulson on Monday confirmed he will attend.
The government is exploring allegations that Paulson and Federal Reserve Chairman Ben Bernanke threatened to oust Bank of America's CEO Kenneth Lewis and the bank's board members if they abandoned the takeover after discovering losses at Merrill.
The panel also is investigating whether Bernanke and Paulson urged Bank of America to keep quiet about Merrill's losses.
Bernanke, who testified before the panel last week, denied the accusations. Paulson also has denied them.
Lewis has testified that Paulson and federal regulators made clear that if Charlotte, N.C.-based Bank of America reneged on its promise to buy Merrill, he and the bank's board members would be fired.
Bank of America agreed in September to acquire Merrill Lynch. Regulators in January provided Bank of America, which already had received $25 billion from the government's bailout program, an extra $20 billion to help it cope with rising losses related to the acquisition.
by the associated press
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