Brian Moynihan, President of BofA Requested to Disclose his Own Alleged Fraud to Audit Committee

Los Angeles, March 6, 2010 -  In a notice to Brian Moynihan President/CEO of Bank of America Corporation (BAC), Los Angeles resident, Dr. Joseph Zernik, provided Mr. Moynihan with evidence of Mr. Moynihan’s own alleged fraud and other criminal conduct, starting on December 10, 2008, with the appointment of Mr. Moynihan as General Counsel of BAC, following the ouster of Mr. Timothy Mayopoulos as General Counsel. Accordingly, Mr. Moynihan was requested to comply with the law – Sarbanes Oxley Act (2002), and disclose his own alleged fraud and criminal conduct to the Audit Committee of BAC. [1]

While the office of Attorney General of the State of New York was focused on pursuing alleged securities fraud by senior officers of BAC surrounding the December 2008 merger with Merrill Lynch, chaperoned or coerced by senior US officers, Dr. Zernik provided Mr. Moynihan with evidence of the origins of the alleged criminalities in the earlier, January 2008 chaperoned/coerced merger with Countrywide Financial Corporation (CFC). One focus of investigations relative to the merger with Merrill Lynch was on the ouster, on December 10, 2008, of Mr. Timothy Mayopoulos, then BAC General Counsel, in the midst of negotiation of the Merrill Lynch merger, and his escort out of the BAC corporate headquarters by security. Again, Dr. Zernik provided evidence that correlated such events with conduct related to the earlier merger - with CFC. Mr Mayopoulos was replaced on December 10, 2008, as BAC General Counsel by Mr. Brian Moynihan - today BAC President and CEO. The evidence provided by Dr. Zernik finds that the appointment of Mr. Brian Moynihan as General Counsel was tightly correlated with resumption of alleged criminalities related to CFC, which were halted during the tenure of Mr. Mayopoulos as General Counsel at BAC.

The evidence provided alleged that the transformation of BAC into an allegedly corrupt organization took place between January 8 and January 11, 2008, in the decision to merge BAC with CFC. The collapse of CFC on January 8, 2008 followed publication in the NYT of the filing of "recreated letters" as evidence in US Bankruptcy Court in Pittsburgh, Pennsylvania. [2] Financial markets were reported under "tremors". It should be noted that investors did not distinguish between fraud in financial reports and fraud against individuals, such as the filing of the “recreated letter”. The realization that the Legal Department of CFC was engaged in fraudulent conduct in the courts undermined investors' confidence. Neither does Sarbanes Oxley Act (2002) make any such distinction between fraud against individuals and fraud in financial reports in its requirement to report fraud by management to the Audit Committee.

Dr. Zernik claimed that the merger announced on January 11, 2008 could not be honestly accepted by senior Officers and the Board of Directors of BAC consistent with the investors' interests. Agreement was to purchase CFC for stock exchange at over $4 billions, whereas the true value of CFC was in the negative many billions of dollars. Additionally, it is claimed that the transaction harbored substantial criminal liabilities for BAC and its officers, which could not escape the notice of General Counsel Timothy Mayopoulos. Such criminal liabilities stemmed from conduct of the underwriting department of CFC, which had been engaged in false underwriting and funding of government-backed residential loans for years, and in the litigation practices of the Legal Department of CFC. Such litigation practices were documented in great detail during the due diligence period, in the March 5, 2008 Memorandum Opinion of Judge Jeff Bohm, US Bankruptcy Court, Houston Texas. [3]

Of particular interest in Judge Bohm's opinion were the detailed description of the false appearances by false outside counsel for CFC, who was not Counsel of Record, and who was employed with "no communications with client" clause. Additionally, the opinion cited a year-long study by the US Trustee, conducted in conjunction with investigation by Judge Bohm of CFC's litigation practices across the US. It is alleged that the evidence in that opinion should have been sufficient for indictment of Sandor Samuels and the CFC Legal Department as a corrupt organization, for looting of home owners across the US, and for securities fraud, stemming from failure to disclose such corrupt practices to investors and to the Audit Committee of CFC.

Analysis of the records in the case of Dr. Joseph Zernik, resident of Los Angeles County, California - home base of CFC, allowed to draw entirely novel conclusions regarding events related to the merger of CFC and BAC, which was announced on January 11, 2008, and was concluded on July 1, 2008, and also regarding the ouster of Timothy Mayopoulos on December 10, 2008:

1) Period from July 1, 2008 (takeover of CFC by BAC) to December 10. 2008 (ouster of Mr. Mayopoulos)

Based on conduct of the office of General Counsel of BAC under Mr. Mayopoulos's leadership, from July 1, 2008 (takeover of CFC by BAC) to December 10. 2008 (ouster of Mayopoulos), on the one hand, and conduct of the various US law enforcement agencies, on the other, a reasonable person would conclude that secret agreements were reached between BAC leadership - particularly Mayopoulos, and senior US officers, regarding the alleged criminality at CFC. It is claimed that such agreements were reached with no authority by the senior US officers involved, and that such agreements stood contrary to the rule of law and the US Constitution. Such agreements were never disclosed to investors or to the US Congress.

During this period noted above, Dr. Zernik repeatedly called the office of Mr. Mayopoulos, and spoke with senior staff of that office. Dr. .Zernik also left voice mail messages with Mr. Mayopoulos himself, and also messages with his secretary. In all such interactions, it was clearly stated by senior staff of the office of BAC General Counsel that Bryan Cave, LLP was NOT authorized to appear at the Los Angeles Superior Court under caption of Samaan v Zernik (SC087400). Conduct of Bryan Cave, LLP, under that caption was alleged by Dr. Zernik as malicious litigation by CFC and others, amounting to serious violations of Human Rights of Joseph Zernik, and evidence of criminality by Mr. Sandor Samuels - then Chief Legal Officer of CFC, and others.

In all such interactions of Dr. Zernik with office of BAC General Counsel during the period noted above, it was clearly stated that Mr. Todd Boock, in-house counsel of the former CFC Legal Department, was the only counsel authorized as Counsel of Record for BAC in Samaan v Zernik (SC087400).

Therefore, review of the records in the period noted above revealed that Mr. Mayopoulos prevented further alleged criminality by the Legal Department of CFC, who had engaged in false employment of outside counsel in Dr. Zernik's case, similar to what was described in opinion of Judge Bohm. However, Mr. Mayopoulos refused to take corrective actions regarding fraud conducted by CFC prior to July 1, 2008. Complaints, which were filed by Dr. Zernik with the Audit Committee of BAC pursuant to Sarbanes Oxley Act (2002) were not reviewed. No disclosures were made to the Audit Committee regarding fraud by management (Sandor Samuels - Chief Legal Officer of CFC, by then - Associate General Counsel of BAC), and false certifications were signed by BAC officers pursuant to Sarbanes Oxley Act (2002) in periodic reports to SEC.

US law enforcement agencies would not enforce the law at BAC and CFC. No matter how credible the evidence of criminality was in records that were filed by Dr. Zernik with such agencies. No US agency would take any action against these financial institutions. Such conduct also amounted to refusal to provide Dr. Joseph Zernik Equal Protection under the law.

Such absurd position was also evidenced in the litigation of SEC v BAC (1-09-cv-06829) at the US District Court, NY.

2) Period from December 10, 2008 (replacement of Timothy Mayopoulos by Brian Moynihan as General Counsel at BAC) and to this date

Upon review of records in Dr. Zernik's case, a reasonable person would conclude that BAC, starting December 10, 2008, abandoned any notion of compliance with the law, which was attempted under the leadership of Timothy Mayopoulos at the office of General Counsel. With the appointment of Brian Moynihan as General Counsel on December 10, 2008, BAC started flaunting of its alleged criminality. On the other hand - US law enforcement agencies continued their position of refusal to enforce the law at BAC.

a) Resumption and flaunting of alleged criminality within 24 hours from ouster of Timothy Mayopoulos.

Dr. Zernik was not aware at the time of the ouster of Mr. Mayopoulos. However, he was astonished on December 11, 2008, with the resumption of alleged criminalities by BAC - alleged retaliation, intimidation and harassment of a victim/ witness/informant through renewed false appearances by Bryan Cave, LLP. [4]

The actions that were falsely taken by Bryan Cave, LLP and BAC at that time were seen as flaunting of criminality: Brian Cave, LLP filed ex parte application for shortened notice hearing on OSC contempt and serious sanctions against Dr. Zernik. The main claim being that Dr. Zernik was guilty of contempt in calling the office of BAC General Counsel Mayopoulos and finding out that Bryan Cave, LLP was engaged in alleged criminalities at the court in Los Angeles. [5]

It was alleged that such conduct, taking place less than 24 hours after the ouster of Mr. Mayopoulos and his replacement by Mr. Moynihan, could not have taken place absent permission, or at least cognizance by Mr. Moynihan. It was further alleged that upon discovery it would be found that Mr. Moynihan in fact permitted Mr. Sandor Samuels to resume the alleged criminal practices of the former CFC Legal Department, in fact relieving the CFC Legal Department from requirements publicly stated in the BAC Outside Counsel Procedures, which purported to guarantee investors and the public at large honest conduct by the office BAC General Counsel. [6]

b) Flaunting by the former CFC Legal Department their exemption from procedures of the BAC General Counsel

The flaunting of alleged criminality in appearances of Bryan Cave, L.L.P, and exemption of the former CFC Legal Department from supervision by the BAC office of General Counsel procedures was particularly noted in March 18, 2009 email notice by Todd Boock, [7] in-house counsel of the former CFC Legal Department, to Dr. Zernik. Mr. Boock was repeatedly noted by BAC office of General Counsel as the ONLY counsel authorized as Counsel of Record in Samaan v Zernik (SC087400). The email was addressed to Dr. Zernik and copied to Phil Wertz of the BAC General Counsel Office, stating falsely that Bryan Cave, L.L.P. should be addressed by Dr. Zernik in matters pertaining to Samaan v Zernik, and that Zernik should ignore all information he had previously received to the contrary from office of the BAC General Counsel in that matter.

c) False and deliberately misleading responses by office of Brian Moynihan to the US Office of Comptroller of the Currency on Zernik's complaint (#00971981)

In late September 2009 Dr. Zernik filed complaint against BAC with US Office of the Comptroller of the Currency (#00971981).

Three main issues were noted in the complaint:
1) Refusal of BAC and its Audit Committee to pronounce on hundreds of false banking records produced by CFC and false court actions that were conducted by CFC and later BAC, and were subject of repeated complaints by Dr. Zernik to the Audit Committee of BAC.
2) False appearances by Outside Counsel which was not Counsel of Record - Bryan Cave, LLP. A clear statement was requested by authorized person at BAC, whether Bryan Cave LLP was Counsel of Record in Samaan v Zernik (SC087400), and if so - to specify the date of such engagement.
3) Collection of funds by parties that were related to CFC or BAC, purported as sanctions against Dr. Zernik, from Attorney David Pasternak, falsely representing himself as "Receiver" for enforcement of judgment that never existed as a valid entered judgment, and who failed to obtain valid appointment order as Receiver, as required by law. Such conduct by CFC and BAC was alleged as money laundering, or monetary transactions in funds derived from specified prohibited conduct.

By January 1, 2010, the date of appointment of Brian Moynihan as President and CEO of BAC, BAC failed to respond at all on Dr. Zernik's complaint to OCC, over 2 months earlier, in disregard of standard time-frames stated by OCC. Moreover, by that time OCC claimed to have twice "escalated" the complaint.

Such state of affairs was reported by Dr. Zernik, starting late December 2009 to both Brian Moynihan, by then announced as the newly appointed CEO/President of BAC, and to Mary Schapiro, Chair of SEC. Both Schapiro and Moynihan acknowledged receipt of Dr. Zernik's notices. In such notices Dr. Zernik claimed that the refusal of BAC to respond on complaint filed with OCC, alleging fraud by BAC management, must be deemed material deficiency in itself, given the seriousness of the allegations. Therefore, Dr. Zernik claimed that the refusal to respond on the complaint to OCC must be accordingly disclosed to the BAC Audit Committee, and also in periodic reports to SEC and investors.

Consequently, on January 8, 2010, response letter was issued on the complaint to OCC (#00971981)[8] [9] by the office of BAC CEO/President Brian Moynihan. Two copies were provided below of such response. One [8] is the copy which was mailed to Dr. Zernik, and the other was the copy which was faxed to OCC, and was obtained by Dr. Zernik through FOIA-request. [9] Both copies show the same feature - although they were noted in the body of the response as transmitted from Charlotte, North Carolina, office of Brian Moynihan, President & CEO, they passed on the way through California, presumably at the former CFC Legal Department, prior to being forwarded to their final destinations.

It was alleged that upon discovery, it would be found that such response amounted to fraud, which was tightly coordinated by Mr. Brian Moynihan himself and Mr. Sandor Samuels and/or Mr. Todd Boock at the former CFC Legal Department.

The nature of the fraud was three-fold:
1) Regarding the alleged fraud in CFC banking records that had been produced in response to legal subpoenas, BAC refused to make any pronouncement. Instead, it made a false and deliberately misleading statement that it would not produce loan records to Dr. Zernik. Dr. Zernik never requested production of loan records. All such loan records had already been produced. Instead, Dr. Zernik only requested review by the Audit Committee of his claims of large scale fraud in banking records that had already been produced and falsely represented as true and valid loan records..
2) Regarding authorization of Bryan Cave, L.L.P., if any, as Outside Counsel of Record under caption of Samaan v Zernik (SC087400), BAC failed to make any explicit, valid statement by an authorized person. Neither did BAC state a date of enlargement. However, BAC did make in its response a statement pertaining to Bryan Cave, L.L.P, that should be deemed upon review as fraud.
3) BAC failed to respond on the issue of monetary transactions conducted with Attorney David Pasternak. BAC never disclosed who the recipients of the funds were, and what the designation of such transactions in BAC accounting was.

It should be noted that at least two such transactions were recorded by the false "Receiver" Attorney David Pasternak, who was and is a close personal friend of Mr. Sandor Samuels. [10], [11]

It should also be noted that in a phone call by Dr. Joseph Zernik to OCC on March 5, 2010, he was informed that OCC had not made any determination on his complaint against BAC (#00971981) to that date. Such delay was inexplicable, and fell outside any of the stated time frames for response by OCC on complaints by individuals against national banks, as stated by OCC staff.

In sum:

The state of affairs stemming from the 2008 merger of BAC with an alleged corrupt organization that was CFC, which was chaperoned/coerced by senior US officers, was that BAC top management was flaunting alleged criminality, while US law enforcement agencies were consistent in their refusal to enforce the law. Such state of affairs was inconsistent with the rule of law, with the US Constitution, with the Basel Accords on international banking, and with investors' interests. Such conduct by US agencies and senior US officers exposed US and world financial markets to unreasonable risks.

Links: (If links do not work, cut & paste them into your browzer.)

[1] March 6, 2010 Request filed by Dr. Joseph Zernik with Mr. Brian Moynihan, President/CEO of Bank of America Corporation, to disclose his own alleged fraud and criminal conduct to the Audit Committee of Bank of America Corporation.

http://www.scribd.com/doc/27937374/10-03-06-Bank-of-America-Requesting-President-CEO-Brian-Moynihan-to-Disclose-His

-Own-Fraud-to-the-Audit-Committee-s

[2] January 8, 2008 Three recreated letters and a transcript from Case of Borrower Sharon Diane Hill (01-22574).
Publication of the story by the NYT on January 8, 2008 caused the collapse of Countrywide Financial Corporation, and "tremors" to financial markets.
http://www.scribd.com/doc/25003494/08-01-08-Countrywide-Recreated-Letters-Transcript-in-case-of-Borrower-Hill-Pittsburgh-PA-s

[3] March 5, 2008 Memorandum Opinion of Judge Jeff Bohm, in case of Borrow William Alan Parsley (05-90374).
The opinion provided detailed analysis of the malicious litigation practices of Countrywide Financial Corporation in courts across the United States. Of Particular interest was Judge Jeff Bohm's analysis of the practice involving employment of false counsel who was not counsel of record and who was employed with "no communications with clients" clause. The opinion was based in part on a year-long study by the US Trustee of litigation practices of Countrywide Financial Corporation across the United States.
http://www.scribd.com/doc/25001966/08-03-05-Countrywide-Judge-Jeff-Bohm-s-rebuke-of-litigation-practices-Case-of-Borrower-Parsley-

Houston-Texas-Dkt-248-re-Countrywide-s-false-ou

[4] December 11, 2008 - false notice by Bryan Cave, L.L.P. on behalf of Non Party Countrywide Home Loans, Inc barely 24 hours after the ouster of Timothy Mayopoulos as General Counsel of Bank of America Corporation resumption of obstructionist/malicious conduct by false counsel, who was not counsel of record under caption of Samaan v Zernik (SC087400) at the Superior Court of California County of Los Angeles. Bryan Cave, LLP attorney deliberately made such notices defective on their faces, nevertheless, the intended harm was affected. The case number in the notice is false, and the signature was invalid - not even in the name of an attorney, let alone counsel of record.
http://www.scribd.com/doc/27932293/08-12-11-Bryan-Cave-LLP-Notice-of-Ex-Parte-Appearance-on-Behalf-of-Non-Party-Countrywide-

Home-Loans-Inc

[5] December 15, 2008 Ex parte application by Non Party Countrywide for short notice hearing on contempt and sanctions against Dr. Zernik. Such court actions were alleged retaliation/intimidation/harassment against witness/victim/informant and also obstruction/perversion of justice. The application was deemed as an act of flaunting criminality, since it was based on a claim of contempt related to Dr. Zernik contacting the office of BAC General Counsel and obtaining information that Bryan Cave, L.L.P. was NOT authorized to appear in court under Samaan v Zernik (SC087400).
http://www.scribd.com/doc/27932188/08-12-15-Countrywide-Ex-Parte-Application-for-a-Short-Notice-Hearing-on-Motion-for-OSC-Con

tempt-and-Sanctions

[6] April 2008 the published BAC Outside Counsel Procedures. Obstructionist conduct by outside counsel is strictly prohibited. Outside Counsel is not allowed to appear unless authorized by BAC office of the General Counsel, and Outside Counsel is required to report per Sarbanes Oxley Act (2002) section 307. Bryan Cave, LLP, and the former CFC Legal Department, headed by Sandor Samuels were exempted from all such procedures starting December 11, 2008, under Bryan Moynihan.
http://www.scribd.com/doc/27932516/08-12-11-Bank-of-America-Outside-Counsel-Procedures-s

[7] March 18, 2009 email notice by Todd Boock, in-house counsel of the former CFC Legal Department, addressed to Dr. Joseph Zernik and copied to Phil Wertz from the BAC office of General Counsel. While Todd Boock was the truly listed counsel of record in Samaan v Zernik (SC087400) according to the General Counsel of BAC, he refused to communicate on the matter, and referred it to false counsel Bryan Cave, L.L.P. He copied the notice to Wertz, to negate the opposite information, repeatedly provided by Mr. Wertz to Dr. Zernik, but with no legal foundation.
http://www.scribd.com/doc/27932604/09-03-18-Samaan-v-Zernik-SC087400-Email-notice-by-Bank-of-America-In-house-Counsel-Todd-Boo

ck-to-Joseph-Zernik-s

[8] January 8, 2010 copy of response from office of Brian Moynihan, BAC CEO & President on complaint to OCC (#00971981) - as mailed to Dr. Zernik. It was alleged that such response should be deemed as fraud, tightly coordinated by office of Mr. Brian Cave and the former CFC Legal Department - Mr. Sandor Samuels and/or Mr. Todd Boock.
http://www.scribd.com/doc/27932742/10-01-08-Bank-of-America-Response-letter-by-office-of-President-CEO-Brian-Moynihan-to-Office-of-

Comptroller-of-the-Currency-on-Zernik-s-Complaint-0

[9] January 8, 2010 copy of response from office of Brian Moynihan, BAC CEO & President on complaint to OCC (#00971981) - as faxed to OCC. It was alleged that such response should be deemed as fraud, tightly coordinated by office of Mr. Brian Cave and the former CFC Legal Department - Mr. Sandor Samuels and/or Mr. Todd Boock.
http://www.scribd.com/doc/27932890/10-01-08-Bank-of-America-Response-letter-by-office-of-President-CEO-Brian-Moynihan-to-Office-of- Co mptroller-of-the-Currency-on-Zernik-s-Complaint-J

[10] January 14, 2009 Report by David Pasternak, listing payment on December 2, 2008 of $7,500 to Countrywide Home Loans. Neither BAC nor Bryan Cave, L.L.P. would answer regarding the identity of the party that collected such funds and their designation.
http://www.scribd.com/doc/27933024/09-01-14-Samaan-v-Zernik-SC087400-Attorney-David-Pasternak-s-false-fourteenth-interim-report-s

[11] February 24, 2009 Pasternak’s Report, listing payment of $5,564 50 to Countrywide Home Loans.
http://www.scribd.com/doc/27933161/09-02-24-Samaan-v-Zernik-SC087400-Attorney-David-Pasternak-s-false-16th-interim-report

Source: http://www.liveleak.com/view?i=e96_1267913081