On a related Ken Feinberg note...
http://online.wsj.com/article/SB10001424052748703294904575385120617510164.html
BUSINESS JULY 23, 2010
Feinberg: Unfair to Ask Firms to Return Payouts
VICTORIA MCGRANE
WASHINGTON — U.S. "pay czar" Kenneth Feinberg on Friday declined to request 17 financial firms that doled out $1.6 billion in "ill advised" executive compensation to return the excessive payouts, saying to do so would be unfair to the companies and could trigger private lawsuits and additional Congressional investigation.
Mr. Feinberg released a report that found 17 firms—including Goldman Sachs Group Inc., J.P. Morgan Chase & Co. and Citigroup Inc.—made the bonus-like payouts to top executives in late 2008 and early 2009 even as the companies were receiving taxpayer assistance.
Mr. Feinberg, the Obama administration's special master for compensation, said he deemed these payments as "ill advised" both for the sheer amount—some individual payouts exceed $10 million, he said—and the lack of reasonable rationale for their payment.
Other firms Mr. Feinberg criticized for poor judgment included: American Express Co., American International Group Inc., Bank of America Corp., Boston Private Financial Holdings Inc., Capital One Financial Corp., CIT Group Inc., M&T Bank Corp., Regions Financial Corp., Sun Trust Banks Inc., Bank of New York Mellon Corp., Morgan Stanley, PNC Financial Services Group Inc., U.S. Bancorp and Wells Fargo & Co.
But he stopped short of saying any of the firms violated the public interest, the highest criticism allowed by the law mandating his review. None of the firms violated any law or regulation when they made the payouts, Mr. Feinberg told reporters during a briefing Friday.
Mr. Feinberg's study, which was required by the 2009 stimulus law that also created his post, covered the five-month window during which firms were getting government assistance but policy makers hadn't yet enacted executive-compensation restrictions. Those rules came into force in early February 2009.
The payments "were ill advised, they were troublesome. But I do not believe it is fair to declare...that the payments were 'contrary to the public interest,'" he said. In fact, Mr. Feinberg said he undertook the compensation review, which was required by the 2009 stimulus law, with "some reluctance."
"This is arm-chair quarterbacking," he said.
Mr. Feinberg also said he felt it was inappropriate for him to ask any of the 17 firms to claw back or reimburse taxpayers for the bonus payouts. Under the law he has no authority to demand repayment, but Congress did direct him to request reimbursement if appropriate.
Nonetheless, Mr. Feinberg felt these payouts were misguided enough to push the firms to adopt a policy that would limit their ability to pay out large sums during the next crisis.
Specifically, Mr. Feinberg's plan would enable a company's compensation committee to restructure, reduce or cancel pending executive payouts once the company's board of directors judged the firm to be in a crisis situation.
It remains unclear if any of the 17 firms will actually adopt Mr. Feinberg's recommendations. The proposal is voluntary, and the government's influence over many of the cited firms has waned. Eleven of the 17 firms have fully repaid taxpayers.
But Mr. Feinberg, who has discussed his proposal with each of the 17 firms cited by his report, said he is "hopeful" the firms will comply. "I have not heard much pushback."
The study is the result of four months spent reviewing pay at 419 firms that took government money during the crisis. The task was in addition to Mr. Feinberg's core assignment to review pay at a handful of firms that received "extraordinary" assistance from the government.
Mr. Feinberg narrowed his study to "highly compensated employees" with annual pay packages of more than $500,000 that received payments that were later curbed by Congress and Treasury, including cash bonuses, retention rewards, stock grants and golden parachutes.
Showing posts with label Kenneth Feinberg. Show all posts
Showing posts with label Kenneth Feinberg. Show all posts
Friday, July 30, 2010
Obama Claimed Escrow Fund Would Not 'Supersede' Claims in Court
http://videocafe.crooksandliars.com/node/38480
President Obama Claimed Escrow Fund From BP Would Not 'Supersede' Rights to Present Claims in Court, Feinberg Says It Will
Heather
Tuesday Jul 20, 2010
Even though I still agree that those who have been damaged by the oil spill in the Gulf getting something from BP right now is better than what we saw happen after the Exxon Valdez disaster -- where those who had claims got stalled for years and our wonderful corporatist Supreme Court decided that if they weren't dead yet ages later they were going to get next to nothing for their suffering -- it looks like Kenneth Feinberg is going back on the Obama administration's promise that taking money from BP now will not prevent anyone who has been damaged and who takes money from the escrow fund now from having the right to sue BP later.
Here's a portion of a press release from the Obama administration on June 16th of this year.
This $20 billion will provide substantial assurance that the claims people and businesses have will be honored. It’s also important to emphasize this is not a cap. The people of the Gulf have my commitment that BP will meet its obligations to them. BP has publicly pledged to make good on the claims that it owes to the people in the Gulf, and so the agreement we reached sets up a financial and legal framework to do it.
Another important element is that this $20 billion fund will not be controlled by either BP or by the government. It will be put in a escrow account, administered by an impartial, independent third party. So if you or your business has suffered an economic loss as a result of this spill, you’ll be eligible to file a claim for part of this $20 billion. This fund does not supersede either individuals’ rights or states’ rights to present claims in court. BP will also continue to be liable for the environmental disaster it has caused, and we’re going to continue to work to make sure that they address it.
Kenneth Feinberg directly contradicted that statement during his meeting with Louisiana residents on July 15th.
Feinberg: Okay, now I want a lump sum payment. I’m a shrimper. I’m a shrimper and I think that shrimping… I’m outta’ luck for three years. Well, that’s what you say. I’m looking at this. I’m asking the experts down in the Parish and I think, you’re not be going to be out of luck for three years. You’re out of luck for two years. I’ll give you a hundred and forty three thousand dollars if you release BP from any law suit. You can go sue somebody else if you want, but in return for $143.000, here’s the check, you sign away. You won’t sue BP. You decide. Yes, give me the check.
You’re gone. Release, sign your name or, you’re not treating me fairly, I think it’s not enough, I don’t know about the future, I don’t want the money. Don’t take it. Don’t take it. Go file a law suit. Wait. Come back. A year later this program is going to be up and running for I think three years. No rush if you want to wait and see. That’s up to you.
That’s how the program is going to work. Now that’s now how the moratorium is going to work.
Then we cut to the Ed Schultz Show and Mike Papantonio’s slant on this and Ed asking how Kenneth Feinberg is going to be paid.
Papantonio: Well it’s coming from BP, there’s no question it’s coming from BP. The question I’m going to raise, I’m going to meet the Feinberg group this week, Wednesday up in New York and the questions I have is who is paying you? We know it’s BP that’s paying Feinberg to do what he’s doing. That’s going around this coast, saying everything’s okay, the $20 billion is in place.
I want to ask Feinberg who’s going to bonus you if you save money on this $20 billion by not paying it to the victims. At this point he’s been handled like mamma Theresa, like Mother Theresa. He is not Mother Theresa.
I respect Ken Feinberg, I’ve worked against Ken Feinberg, he’s a great lawyer, but you’ve got to keep your eyes on the ball. He is working for BP. He’s not working for victims.
Kenneth Feinberg claims he’s working independently even though he’s being paid by BP. I’m not sure how independent you can expect someone to be if that’s who’s writing his paycheck as Pap noted.
Someone needs to ask President Obama why Ken Feinberg is directly contradicting him on claims against BP and those with claims giving away their right to sue later and being forced to sign a piece of paper with a BP lawyer there to receive a check.
Feinberg is doing nothing but liability damage for BP if everyone has to sign off not to sue to receive a check right now. That is not how this was painted by the Obama administration. I'd like to know where the rest of our media is on this besides Ed Schultz.
Karoli adds this:
The key here, though, is that no one has to take a final lump sum payment from the fund. It's structured in a way that allows for applicants to apply for, and receive payments that are not final settlements. The best strategy would be to keep coming back to the fund for interim payments, but not sign off on a final lump sum settlement. If there's some reason to do so, I would strongly suggest getting legal advice before doing it.
President Obama Claimed Escrow Fund From BP Would Not 'Supersede' Rights to Present Claims in Court, Feinberg Says It Will
Heather
Tuesday Jul 20, 2010
Even though I still agree that those who have been damaged by the oil spill in the Gulf getting something from BP right now is better than what we saw happen after the Exxon Valdez disaster -- where those who had claims got stalled for years and our wonderful corporatist Supreme Court decided that if they weren't dead yet ages later they were going to get next to nothing for their suffering -- it looks like Kenneth Feinberg is going back on the Obama administration's promise that taking money from BP now will not prevent anyone who has been damaged and who takes money from the escrow fund now from having the right to sue BP later.
Here's a portion of a press release from the Obama administration on June 16th of this year.
This $20 billion will provide substantial assurance that the claims people and businesses have will be honored. It’s also important to emphasize this is not a cap. The people of the Gulf have my commitment that BP will meet its obligations to them. BP has publicly pledged to make good on the claims that it owes to the people in the Gulf, and so the agreement we reached sets up a financial and legal framework to do it.
Another important element is that this $20 billion fund will not be controlled by either BP or by the government. It will be put in a escrow account, administered by an impartial, independent third party. So if you or your business has suffered an economic loss as a result of this spill, you’ll be eligible to file a claim for part of this $20 billion. This fund does not supersede either individuals’ rights or states’ rights to present claims in court. BP will also continue to be liable for the environmental disaster it has caused, and we’re going to continue to work to make sure that they address it.
Kenneth Feinberg directly contradicted that statement during his meeting with Louisiana residents on July 15th.
Feinberg: Okay, now I want a lump sum payment. I’m a shrimper. I’m a shrimper and I think that shrimping… I’m outta’ luck for three years. Well, that’s what you say. I’m looking at this. I’m asking the experts down in the Parish and I think, you’re not be going to be out of luck for three years. You’re out of luck for two years. I’ll give you a hundred and forty three thousand dollars if you release BP from any law suit. You can go sue somebody else if you want, but in return for $143.000, here’s the check, you sign away. You won’t sue BP. You decide. Yes, give me the check.
You’re gone. Release, sign your name or, you’re not treating me fairly, I think it’s not enough, I don’t know about the future, I don’t want the money. Don’t take it. Don’t take it. Go file a law suit. Wait. Come back. A year later this program is going to be up and running for I think three years. No rush if you want to wait and see. That’s up to you.
That’s how the program is going to work. Now that’s now how the moratorium is going to work.
Then we cut to the Ed Schultz Show and Mike Papantonio’s slant on this and Ed asking how Kenneth Feinberg is going to be paid.
Papantonio: Well it’s coming from BP, there’s no question it’s coming from BP. The question I’m going to raise, I’m going to meet the Feinberg group this week, Wednesday up in New York and the questions I have is who is paying you? We know it’s BP that’s paying Feinberg to do what he’s doing. That’s going around this coast, saying everything’s okay, the $20 billion is in place.
I want to ask Feinberg who’s going to bonus you if you save money on this $20 billion by not paying it to the victims. At this point he’s been handled like mamma Theresa, like Mother Theresa. He is not Mother Theresa.
I respect Ken Feinberg, I’ve worked against Ken Feinberg, he’s a great lawyer, but you’ve got to keep your eyes on the ball. He is working for BP. He’s not working for victims.
Kenneth Feinberg claims he’s working independently even though he’s being paid by BP. I’m not sure how independent you can expect someone to be if that’s who’s writing his paycheck as Pap noted.
Someone needs to ask President Obama why Ken Feinberg is directly contradicting him on claims against BP and those with claims giving away their right to sue later and being forced to sign a piece of paper with a BP lawyer there to receive a check.
Feinberg is doing nothing but liability damage for BP if everyone has to sign off not to sue to receive a check right now. That is not how this was painted by the Obama administration. I'd like to know where the rest of our media is on this besides Ed Schultz.
Karoli adds this:
The key here, though, is that no one has to take a final lump sum payment from the fund. It's structured in a way that allows for applicants to apply for, and receive payments that are not final settlements. The best strategy would be to keep coming back to the fund for interim payments, but not sign off on a final lump sum settlement. If there's some reason to do so, I would strongly suggest getting legal advice before doing it.
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