Monday, April 06, 2009

Geithner denied that the Administration was crafting bailout initiatives to allow companies to limit exec pay.

WASHINGTON (Reuters) – U.S. Treasury Secretary Timothy Geithner denied on Sunday the Obama administration was crafting bailout initiatives to allow companies to evade limits on executive pay and other restrictions imposed by Congress.

"No, that's not true," Geithner said when asked about a report in Saturday's Washington Post that the White House was trying to allow some exceptions.

"Now, our obligation is to apply the laws that Congress just passed on executive compensation and we're going to do that," he told the CBS program "Face the Nation."

"We're also going to make sure that these programs are as effective as possible in making credit more available to businesses and families across the country."

The Post said President Barack Obama's administration believes it can sidestep the rules because it has in many cases decided not to provide federal aid directly to the financial institutions, instead setting up special entities that act as middlemen to channel the funds.

Executive pay restrictions are among efforts by Congress to claw back bonuses and curb pay amid public anger over executive bonuses at insurer American International Group, which has received a bailout worth up to $180 billion.

The "Pay for Performance Act of 2009" was passed by the House of Representatives last week and now goes to the Senate.
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