Newspaper article International Herald Tribune

Audit Criticizes Salaries at Bailed-Out Companies

Newspaper article International Herald Tribune

Audit Criticizes Salaries at Bailed-Out Companies

Article excerpt

A gorernment monitor found that 68 of 69 executives at Ally Financial, American International Group and General Motors received annual compensation of $1 million or more, with the Treasury's signoff.

Top executives at firms that received taxpayer bailouts during the U.S. financial crisis continue to receive generous government- approved compensation packages, a Treasury monitor has said.

The report comes from the special inspector general for the Troubled Asset Relief Program, the bank bailout law passed at the end of the George W. Bush administration. The monitor, commonly called Sigtarp, found that 68 of 69 executives at Ally Financial, American International Group and General Motors received annual compensation of $1 million or more, with the Treasury's signoff.

All but one of the top executives at the failed insurer A.I.G., which required more than $180 billion in emergency taxpayer financing, received pay packages worth more than $2 million. And 16 top executives at the three firms earned combined pay of more than $100 million.

"In 2012, these three TARP companies convinced Treasury to roll back its guidelines by approving multimillion-dollar pay packages, high cash salaries, huge pay raises and removing compensation tied to meeting performance metrics," Christy Romero, the special inspector general, said in a statement. "Treasury cannot look out for taxpayers' interests if it continues to rely to a great extent on the pay proposed by companies that have historically pushed back on pay limits."

The report charges that the Treasury has failed to rein in excessive pay at the three firms. It found that the Treasury approved all pay raises requested for A.I.G., Ally and General Motors executives last year, with individual compensation increases of $30,000 to $1 million. It also faults the Treasury overseer for allowing pay packages above what comparable executives at other firms receive. …

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