Bank of America’s Brian Moynihan Pulls A “Mark McGwire”

by Jacob Zamansky on January 19th, 2010 at 11:05 am : Comments 000

As I was watching yesterday’s hearings convened by President Obama’s Financial Crisis Inquiry Commission I couldn’t help recall how former baseball slugger and admitted steroid user Mark McGwire sidestepped a question at a Congressional hearing about whether he ever used performance enhancing drugs.

“I’m not here to discuss the past,” he replied, a response quite likely coached by his attorneys to ensure he didn’t say anything legally culpable.

Similarly, Bank of America CEO Brian Moynihan gave a deft legal response when testifying before the Financial Crisis Committee.

“It has been clear how poor business judgments we have made have affected Main Street,” he said.

Though the significance of Moynihan’s comment was lost on the media,  he, too, was making certain he avoided saying anything that could legally come back to haunt him.  There is an aptly named legal doctrine called the “business judgment rule” which states, among other things, that a court will not review the business decisions of directors who performed their duties (1) in good faith; (2) with the care that an ordinarily prudent person in a like position would exercise under similar circumstances; and (3) in a manner the directors reasonably believe to be in the best interests of the corporation.

Moynihan, a lawyer by training, plays possum with a skill that would do famed heavyweight boxer Muhammad Ali proud.

Filed under Bank of America, Congress, Wall Street