Van Hollen, Velazquez Back Penalty Pool to Hold Bank Execs Accountable
WASHINGTON, D.C. – U.S. Sen. Chris Van Hollen (D-Md.) and U.S. Rep. Nydia Velazquez (D-N.Y.) today sent a letter calling on financial regulators to finalize executive pay reforms required by section 956 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which are now 12 years past their statutory due date. Public Citizen has long advocated for this type of reform. Bartlett Naylor, financial reform advocate for Public Citizen, released the following statement:
“Van Hollen and Velazquez have proposed an ingenious idea: that 100% of senior banker incentive pay be placed in a penalty pool, where it can be instantly clawed back if the bank fails or is found to have profited from criminal misconduct. This would, in effect, deputize bankers to police each other. That’s a better mechanism for holding bank executives accountable than the Federal Reserve, bondholders, stock investors, auditors, or any other institution or group can provide. In the wake of Silicon Valley Bank’s failure, it’s long past time to change the incentives for bank executives.”