Two lawmakers from opposite sides of the aisle and even moreso, the ideological spectrum, forged a rare alliance on the issue of limiting the pay of bank CEO’s and executives this week.
Senators Elizabeth Warren (D-Ma.) and J.D Vance (R-Oh.) led a bipartisan group of legislators in sponsoring a bill that would roll back compensation for executives of banks that fail.
The bill could allow regulators to take back up to three years of CEO’s, board members, and shareholders compensation in the event of a bank collapse.
It comes on the heels of a series of bank collapses that shook the United States economy, including the failure of Silicon Valley Bank (SVB), Signature Bank, and First Republican Bank earlier this year.
In March, President Biden proposed reforms that would allow Bank Managers and bank executives to be fined and barred from the banking industry if they were responsible for a bank failing.
Vance railed against recent bailouts for failed banks, saying that taxpayers should not bear the brunt of irresponsible decisions by shareholders and executives.
“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,” he said in a statement.
Other Republican Senators also voiced their support for the legislation, including Senator Mike Braun (R-In.) and Senator Josh Hawley (R-Mo.).
The Epoch Times Reports–
A bipartisan group of senators, led by Sen. Elizabeth Warren (D-Mass.) and Sen. J.D. Vance (R-Ohio), introduced legislation to revive efforts to claw back big bank executives’ compensation in the event of a failure or resolution.
The senators, 11 of whom are members of the Senate Banking, Housing, and Urban Affairs Committee, introduced the Failed Bank Executives Clawback Act. The bill would allow federal regulators to claw back up to three years of compensation earned by bank CEOs, board members, controlling shareholders, and other integral individuals should the company fail or be resolved.
Under current regulations, the Federal Deposit Insurance Corp. (FDIC) possesses little ability to claw back executives’ pay if their banks crumble and impose enormous costs on the banking system and the broader economy.