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Why I Believe Julian Assange Has Dirt on Bank of America

Wednesday, 22 Dec 2010 | 2:13 PM ET

This morning Dick Bove sent out a note to clients explaining that he doubts WikiLeaks founder Julian Assange has “new information” about Bank of America.

Julian Assange
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Julian Assange

I think Bove is likely to be proven wrong.

Bove knows a lot about Bank of America . He’s a smart and feisty guy who I admire.

But I don’t get his logic on WikiLeaks. Bove runs through the various types of information WikiLeaks could expose and dismisses them.

— Emails showing BofA employees didn’t have faith in toxic securities it sold? Bove says that’s possible but thinks the risk sections of the prospectuses will protect the bank.

— Dirt on departed management? That is not really relevant.

— Merrill- or Countrywide-related dirt? This has already been addressed through investigations and fines.

— Information about customers? That would backfire and expose Assange to legal liability for breaching bank customer confidentiality rules.

In other words, Bove thinks there can't be serious dirt on Bank of America in the Wikileaks data because ... he cannot imagine what it could be.

But Bove's failure to imagine a scandal is no indication that one doesn't exist.

Let’s be clear here: A year ago, Assange said he had the hard drive of a Bank of America executive. More recently, he’s said that WikiLeaks is preparing to disclose evidence of an “ecosystem of corruption” at a big US bank. He expects the disclosures to cause resignations. There’s a widespread expectations that Bank of America is the target, even though Assange has been coy about that.

It’s possible everyone is wrong in connecting the dots here. Maybe the new megaleak has nothing to do with Bank of America. It’s also possible that Assange is over-confident in the importance of his information.

But one thing that's highly unlikely is that Assange is making this up. He’s obviously got a huge cache of bank-related documents that he will release next year. If he doesn’t have the documents—or doesn’t release them—his credibility will be badly hurt. He’s got too much to lose here for us to assume he’s being anything but honest.

So what could it be that would damage current management at Bank of America? I don’t know. But I won’t mistake my lack of knowledge for evidence of a lack of damaging information.

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