FDIC approves rule allowing it to "claw back" executive pay at failed firmsSubmitted by bobbyw24 on Wed, 07/06/2011 - 16:46
The Federal Deposit Insurance Corporation (FDIC) approved rules Wednesday that would allow the government to "claw back" up to two years of pay to top executives that drove a financial firm to failure.
In a 5-0 vote, the FDIC approved the rules, mandated by the Dodd-Frank financial reform law. The vote also marked one of the final actions of Sheila Bair as the head of the agency, as her term expires on Friday.
Under the rule, the FDIC could recoup two years of pay made to top executives and directors if it is found they were "substantially responsible" for the downfall of a firm.