February 12, 2009

Wyden Won't Quit Effort to Recover Wall Street Bonuses for Taxpayers

Fight Continues After Measure is Stripped from Economic Recovery Bill

Washington, D.C. - Thanking his cosponsors Senator Olympia Snowe (R-Maine) and Blanche Lincoln (D-Ark) for their leadership in fighting for the recovery of employee bonuses to financial institutions that took "federal bailout" funds from the Troubled Asset Relief Program (TARP), U.S. Senator Ron Wyden (D-Ore.) said that he would find an opportunity to reintroduce the Wyden-Snowe-Lincoln amendment which was stripped from the final language of the American Recovery and Reinvestment Act of 2009. The provision would have required institutions that took bailout funds to either repay the cash portion of any bonus paid in excess of $100,000 early - within 120 days of the amendment's enactment - or face an excise tax of 35% on what is not immediately repaid to the treasury. Savings to be returned by recovering TARP-funded bonuses from Wall Street and bank executives were estimated to bring $3.2 billion back to taxpayers.

"Wall Street's clout continues unabated in Washington, despite having wrecked our economy," said Wyden. "I am unbelievably disappointed, but I want it understood that I will be back again and again to recover for taxpayers the exorbitant Wall Street bonuses paid for with TARP money."

The Wyden-Snowe amendment would have worked in conjunction with the Treasury Department's new guidelines on executive pay for financial institutions receiving TARP funds, by applying to bonuses paid for work in 2008. In 2008, financial institutions received more than $274 billion through TARP, while paying out an estimated $18.4 billion in employee bonuses, which is roughly the same amount paid out in 2004 when the Dow Jones industrial average was over 10,000.