Bank executives who collect lavish compensation while taxpayer bail out their institutions would be forced to reimburse Americans for the expense, under a new bill filed by both steadfast conservative Republican and stridently liberal Democrat lawmakers
Representatives Ken Buck (R-CO), Katie Porter (D-CA), Victoria Spartz (R-IN), Ruben Gallego (D-AZ), and Marie Gluesenkamp Perez (D-WA) introduced the bipartisan “Failed Bank Executives Clawback Act,” which directly targets “unjust compensation earned by executives who threaten our financial system and economy.”
The bill empowers federal watchdogs to “claw back compensation from bank executives who profit off of their bank’s mismanagement of deposits,” a statement from the bill’s sponsor reads, noting that “following the collapse of Silicon Valley Bank and Signature Bank in March 2023, reports emerged that bank executives made millions in stock sales and bonuses from their reckless management in the months leading up to the bank failures.”
“Working Americans should not have to foot the bill for the failures of Silicon Valley Bank executives,” said Buck. “I’m proud to lead this bipartisan bill to make bank CEOs more accountable for any risky financial decisions they make.”
“Bank executives shouldn’t be rewarded when they oversee bank failures, and they shouldn’t be incentivized to put Americans’ money at heightened risk for bigger payouts,” said Porter. “Democrats and Republicans agree: when leaders at big banks engage in reckless risk-taking, they should be held accountable.”
“We cannot be a country with institutions ‘too big to fail’ and policies where reckless executives are not held accountable and shift the risk to taxpayers. The general public should not be on the hook for bad business decisions,” said Spartz.
“Hardworking Arizonans and small businesses were the ones who paid the price when Silicon Valley Bank failed. All the while, SVB’s executives ran off into the sunset fat with cash from bonuses they paid themselves. That’s not how our system should work, and we should claw back those types of pay-outs. But SVB’s failure was years in the making – we need these bank executives to have skin in the game. I am proud to lead this bipartisan legislation to hold bank executives accountable when their mismanagement and incompetence hurts the American people,” said Gallego.
“After Silicon Valley Bank executives lined their pockets with big bonuses, people, businesses, and the entire economy suffered. We need to make sure the people who make reckless decisions that throw the banking system into turmoil can’t walk away with millions of dollars as rewards, and this bipartisan bill makes that possible,” said Gluesenkamp Perez.
Senators Elizabeth Warren (D-MA), Josh Hawley (R-MO), Catherine Cortez Masto (D-NV), and Mike Braun (R-IN) introduced a companion bill in the Senate.
Now we are talking. We have some common ground so let’s act on it now!
NO More bailouts NO