FDIC Seeks To Claw Back Executives Pay
(Bloomberg) The FDIC is thinking about a measure that would subject executives and directors to clawbacks of as much as two years’ pay if they are found “substantially responsible” for the failure of a systemically important financial company. Incentive-based compensation was faulted for inspiring risk-taking at firms such as Lehman and American International Group Inc. (AIG)
FDIC board members voted 5-0 to propose the rule, part of the agency’s expanded liquidation authority under the Dodd-Frank Act. In the same vote, board members laid out a framework for priority payment of creditors and procedures for filing claims in liquidations of large, complex firms, for which the FDIC would serve as receiver.
“Today’s action is another significant step toward leveling the competitive playing field and enforcing market discipline on all financial institutions, no matter their size,” FDIC Chairman Sheila Bair
Click here to continue readingForex Gouging Suspicion Spreads
Some of the largest investment firms in the U.S. have been overcharged by banks for currency trades, bank insiders and others claim, broadening the scope of alleged abuses in pockets of the $4 trillion foreign-exchange market.
BlackRock Inc., the world’s largest fund manager, became concerned at the rates it and its clients were charged for some currency trades by custody banks including Bank of New York Mellon Corp. according to an internal BlackRock investigation about a year ago and people familiar with the firm.
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Click here to continue readingUser Fees on Traders Might Be Necessary
The Commodity Futures Trading Commission may have to impose “user fees” on traders if Congress doesn’t give the agency enough money to police the newly regulated $583 trillion derivatives market, said Commissioner Bart Chilton.
The CFTC has asked Congress for a budget increase to $261 million from $169 million to implement the Dodd-Frank financial overhaul. The law expanded the commission’s jurisdiction to the over-the-counter swaps market for the first time since the products emerged 30 years ago.
Chilton said a fee would be a “last resort” to pay for staff and technology needed to prevent a recurrence of the 2008 financial crisis. The agency may need authority from Congress to levy such a fee, he said.
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