ABC's Lauren Pearle and Charlie Herman report from New York: Attorney General Andrew Cuomo, joined by TARP Inspector General Neil Barofsky, today announced he’s suing Bank of America and former executives Ken Lewis and Joe Price for allegedly hiding massive losses at Merrill so that Bank of America shareholders would approve the merger. Cuomo also claims they defrauded the government: “[o]nce the deal was approved, Bank of America’s management manipulated the federal government into saving the deal with billions in taxpayer funds by falsely claiming that they would back out of the deal without bailout funds,” Cuomo said in a press release. Bank of America received more than $20 billion in taxpayer aid at that time. “This merger is a classic example of how the actions of our nation’s largest financial institutions led to the near-collapse of our financial system,” Cuomo said in today’s press release. Also, the SEC just announced that BofA has agreed to pay $150 million to settle SEC charges that the company failed to disclose employee bonuses and financial losses from the Merrill merger. The announcement comes on the day that Bloomberg reports Bank of America will pay $4.4 billion in employee bonuses to investment banking employees for an average of $400,00 per person. A source familiar with the details of Bank of America’s payment confirms that the Bloomberg story is roughly accurate. Bank of America said that it paid out 19% of revenue in the investment banking division to employee compensation, down from 26%, the highest level reached in 2006. That payout is low compared to investment banks like Goldman Sachs (36% of revenue) and Morgan Stanley (62% of revenue). As is the case with other investment banks, Bank of America is paying much of the bonuses in stock and the bank can “clawback” some of the money if certain risks come to light. As for the Cuomo suit, Robert Stickler with the bank said, “We find it regrettable and are disappointed that the NYAG has chosen to file these charges, which we believe are totally without merit. The evidence demonstrates that Bank of America and its executives, including Ken Lewis and Joe Price, at all times acted in good faith and consistent with their legal and fiduciary obligations. In fact, the SEC had access to the same evidence as the NYAG and concluded that there was no basis to enter either a charge of fraud or to charge individuals. The company and these executives will vigorously defend ourselves."