A federal judge on Tuesday raised fresh questions about the US Securities and Exchange Commission’s settlement with Bank of America over bonus disclosures, calling the regulator’s explanation for why it did not charge individuals “puzzling”.

The SEC, in a court filing on Monday, said BofA’s alleged failure to disclose bonuses paid to Merrill Lynch employees before the companies merged was largely the work of attorneys who advised the banks. The regulator said it was constrained by the fact that the bank had not waived attorney-client privilege.