Douglas Lee Campbell, who worked at Bank of America until 2002 before joining Piper Jaffrays, has admitted fraud and conspiracy charges.
While he has been referred to as an employee of "Bank A" throughout the court case, Bank of America spokesman William Halldin told Bloomberg that the financial institution has been aiding the investigation into Campbell's activities.
"We have been cooperating with law enforcement for several years on this matter," said Mr Halldin.
In 2007, Bank of America agreed to help prosecutors in exchange for leniency.
Under the conspiracy, favored bankers were given inside information from brokers handling the bidding for guaranteed investment contracts (GICs), which are typically purchased by municipalities from capital they have raised via bond sales.
The US Treasury Department encourages competitive bidding for GICs on the basis that the municipalities will be able to obtain market rates.
Municipal authorities can use the investments to make a return on their money until it is needed for public sector work.
But under the scheme the market was carved up, with the brokers being rewarded with kickbacks which were hidden as fees paid by the bankers on interest-rate swaps.
Campbell, who was fired by Bank of America for making payments to companies with "no apparent" services being offered in return, said he made payments to investment contract broker CDR Financial Products.
While three former employees of the company have already entered guilty pleas, two senior executives and the firm's founder are still fighting the charges made against them in this case.
Starting in 1998, Campbell is said to have passed on kickbacks to CDR in exchange for information about rivals' bids for contracts.
Last month, the Securities and Exchange Commission vowed to continue bringing high-profile cases against Wall Street firms in the wake of a $550 million settlement with Goldman Sachs over fraud charges against the bank, reported the Financial Times.
By Gary Cooper