Waxman tells banks to justify bonuses


Boston Globe
October 29, 2008

Congressional investigators demanded State Street Corp., Citigroup Inc., and seven other banks justify billions of dollars in pay and bonuses after they accepted $125 billion as part of a taxpayer-funded bailout.

  • A d v e r t i s e m e n t

In letters to the nine firms yesterday, Representative Henry Waxman, the chairman of the House Committee on Oversight and Government Reform, said they collectively will pay $108 billion in employee compensation and bonuses in the first nine months of 2008, almost the same amount as last year.

“I question the appropriateness of depleting the capital that taxpayers just injected into the banks through the payment of billions of dollars in bonuses, especially after one of the financial industry’s worst years on record,” Waxman wrote.

The letter was also sent to Bank of America, Bank of New York Mellon, JPMorgan Chase & Co., Merrill Lynch & Co., Morgan Stanley, Goldman Sachs Group, and Wells Fargo & Co. Waxman asked the firms to supply the information by Nov. 10.

“We look forward to cooperating with chairman Waxman’s request,” said Michael DuVally, a spokesman for Goldman Sachs. Spokesmen for the other firms declined to comment or didn’t immediately reply to requests for comment.

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