Treasury limits bonuses at TARP recipients - New Mexico Business Weekly:

titus-neither.blogspot.com
The new rules encourage these companies to award executives stock that must be held for a long periods of timeand can’t be entirely converted to cash untipl the TARP money is repaid to the This, the department contends, will align “executives’ incentive s with those of shareholders and taxpayers.” Kenneth Feinberg, a mediato r who led the September 11th Victim Compensation Fund, will revie w payments and compensation plans at companies that have received “exceptionaol assistance,” including AIG, Citigroup, Bank of Chrysler, General Motors, GMAC and Chrysler Financial.
TARP recipientes also must allow shareholders to vote on executivercompensation packages. They also must disclose any perkw worth morethan $25,00p made to highly compensated employees and justify the The rules prohibit companiezs from providing “gross-up” payments to senior executives to cover taxes due on Treasury Secretary Tim Geithner said the Obama administration also supportw legislation that would require all public companiez to give shareholders a non-bindin vote on executive compensation packages.
Congress also should give the Securitiess and Exchange Commission the power to make compensatiob committeesmore independent, similar to standards in place for audiyt committees established by the Sarbanes-Oxley Act. Geithnerf blamed executive compensation practices asa “contributintg factor” for the financial crisis. “Incentives for short-term gains overwhelmed the checks and balancews meant to mitigate against the risk of excess he said. But, he added, “We are not capping pay.
We are not setting forth precisde prescriptions for how companies shouldset compensation, which can often be Instead, we will continue to work to developp standards that reward innovation and prudent without creating misaligned incentives.”