Government Allowed Huge Exec Pay at Bailout Firms

Photo (cc) by pmarkham

From Reuters

“While taxpayers struggle to overcome the recent financial crisis and look to the U.S. government to put a lid on compensation for executives of firms whose missteps nearly crippled the U.S. financial system, the U.S. Department of the Treasury continues to allow excessive executive pay,” the [Inspector General’s] report said.

In 2012, the pay czar acceded to company requests in approving multimillion-dollar pay packages and pay hikes for top executives at General Motors, AIG and Ally Financial.

The Special Master approved all 18 pay raises requested by the companies, for a total of $6.2 million, and approved pay packages of at least $1 million for 68 of the 69 employees at the companies it was overseeing, the report found.

The report also points to a case where the Treasury approved a $50,000 raise when the company’s reasoning was just that they wanted to “do a little extra for him.” The Treasury’s own rules say salaries should rarely top $500,000, but last year a third of top execs got more than that, a number that’s quadrupled since 2009.

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