Report: Treasury OKed “excessive” salaries for bailed-out firms
The U.S. Treasury approved "excessive" pay raises for executives at several bailed-out firms last year, according to a new report by the Special Inspector General overseeing the Troubled Asset Relief Program.
The report criticizes the Treasury for approving all 18 pay raise requests from AIG, General Motors, and Ally Financial, 14 of which amounted to $100,000 or more. The biggest raise was for $1 million.
From the report:
[The Special Inspector General for TARP] found that once again, in 2012, Treasury failed to rein in excessive pay. In 2012, [the Office of the Special Master for TARP Executive Compensation] approved pay packages of $3 million or more for 54% of the 69 Top 25 employees at American International Group, Inc. (“AIG”), General Motors Corporation (“GM”), and Ally Financial Inc. (“Ally,” formerly General Motors Acceptance Corporation, Inc.) – 23% of these top executives (16 of 69) received Treasury-approved pay packages of $5 million or more, and 30% (21 of 69) received pay ranging from $3 million to $4.9 million. Treasury seemingly set a floor, awarding 2012 total pay of at least $1 million for all but one person. Even though OSM set guidelines aimed at curbing excessive pay, SIGTARP previously warned that Treasury lacked robust criteria, policies, and procedures to ensure those guidelines are met. Treasury made no meaningful reform to its processes.