Financial Services Committee to Consider Legislation to Prohibit Bonus Payments
House Financial Services Committee Chairman Barney Frank (D-MA) announced today the committee will consider legislation to prohibit any bonus payments by companies who have received capital investments under the TARP program and the Housing and Economic Recovery Act until these investments are repaid in full. The bill also prohibits any compensation arrangements that are excessive and all non-performance based bonuses for these companies.
The bill adds new compensation/bonus restrictions to the Emergency Economic Stabilization Act for financial institutions that receive or have received a capital investment by the Treasury Department under the Troubled Asset Relief Program or the Housing and Economic Recovery Act (which covers Fannie Mae, Freddie Mac and the Federal Home Loan Banks). While such a capital investment is outstanding, recipients will be prohibited from:
The legislation will be “marked-up” in the Financial Services Committee on Tuesday, March 24th, and the full House of Representatives will be able to consider the legislation the following week.