WASHINGTON — Sen. Elizabeth Warren, D-Mass., has
Warren, along with banking lawmakers Sens. J.D. Vance, R-Ohio, Bob Menendez, D-N.J., Katie Britt, R-Ala., Mark Warner, D-Va., Kevin Cramer, R-N.D., Chris Van Hollen, D-Md., Tina Smith, D-Minn., Raphael Warnock, D-Ga., and John Fetterman, D-Pa.,
The bill would require federal regulators to take back up to three years of compensation received by the executives and other key decision-makers of failed banks. While the FDIC already has some authority to claw back this compensation, the bill would expand that power, including by extending the authority in Dodd-Frank to apply to any bank entered into FDIC receivership, not just those resolved under the FDIC's Liquidation Authority.
"Nearly three months after the collapse of Silicon Valley Bank, a bipartisan group of Senators is demonstrating a serious commitment to pass legislation requiring financial regulators to claw back pay from executives when they implode their bank," Warren said in a statement. "Congress must answer the President's call for stronger laws to hold failed bank executives accountable, and I'm determined to work with lawmakers on both sides of the aisle in the Senate Banking, Housing, and Urban Affairs Committee to deliver change."
The issue of executive compensation is
"The executives responsible for running their banks into the ground are sitting on millions of dollars in compensation and bonuses. Meanwhile, the American people are bearing the financial burden for their excessive risk taking and gross mismanagement," Vance said in a statement. "This legislation would right that wrong and ensure that failed bank executives are held accountable for the collapse of their institutions – not the American taxpayer."
But while there's bipartisan support for the bill on the Senate side, it's less clear that Republican lawmakers in the GOP-controlled House will pick up the issue. At a House hearing with the executives of the trio of failed banks, Republican lawmakers appeared more interested in advancing bills aimed at stricter oversight of the Federal Reserve.
