The SEC is going all in. Or is it? 

The agency has announced that it will "vigorously" pursue its case against Bank of America, seeking to prove that management failed to disclose material information regarding the payment of billions in bonuses at Merrill Lynch. The announcement generated lots of headlines, and kept Bank of America on the PR defensive. 

The SEC also said, "We will use the additional discovery available in the litigation to further pursue the facts and determine whether to seek the court's permission to bring additional charges in this case." An aggressive posture to be sure. 

But you have to ask: What else can it really do right now? The SEC was left with few good options after Judge Jed Rakoff rejected its controversial $33 million settlement with Bank of America. It couldn't just drop the case. That would really have ignited a firestorm of controversy, and you get the feeling that there would be no settlement that Rakoff would find palatable. So the only thing to do is soldier forward. 

But it has left itself an out. The Washington Post notes "the agency could still appeal Rakoff's order to the U.S. Court of Appeals for the Second Circuit. The SEC on Monday left this option open." We'll have to wait and see if the agency plays this card. You certainly cannot blame them if they do. 

If they choose not to appeal, then Judge Rakoff may get what he wanted--accountability and names. If this goes to trial, it will surely be a barn burner. The lawyers are loving this. The issue then becomes who gets named? CEO Ken Lewis is of course a candidate, but there could be others. - Jim