Bank of America: Evil genius.
This is going very deep into the weeds, so bear with me. It's an example of just how large banks are exploiting lax regulation to screw us.
Bank of America has a LOT of toxic assets on his hands. Specifically it has instruments called derivatives that may cause it to have to pay out a lot of money very soon. Bank of America isn't actually a bank; it's really a holding company with many different types of institutions beneath it.
Well, knowing that its Merrill Lynch division might get blowed up by these derivative contracts, BoA recently transferred them to a normal deposit-taking institution. You know, the type of place that you and drop our paychecks every couple of weeks.
The reason for this? The bankruptcy reform act passed in 2005 gives the holders of derivative contracts first dibs on a firm's assets in a bankruptcy. What this means is that if these assets blow up, all of the deposits at the institution BoA dropped them off at will be used to pay off the contracts. Of course, as a deposit-taking institution, the depositers will be made whole by the FDIC. That is to say: you and me, the taxpayers.
It's a pretty ingenious scheme. It's also positively evil. BoA has figured out a way to get you and I to pay off Merrill Lynch's bad bets.