Grassley Seeks Accountability on Severance Payments to TARP Executives

This story appeared in Bank Digest.

Senator Chuck Grassley, R-Iowa, has asked the Special Inspector General for TARP to investigate why the Treasury Department did not follow through on the mandate from Congress in last year’s stimulus bill to require that all TARP recipients, including AIG, meet appropriate standards for executive compensation. “Since the Treasury Department failed to do this, we now see the multi-million severance payments going to departing TARP executives, such as the $3.9 million paid in severance to AIG’s former general counsel, who left the job voluntarily,” Grassley said. Grassley also asked the TARP watchdog to determine if Treasury  Department officials with potential conflicts of interest were permitted to draft the Treasury regulations that govern executive compensation, including severance at bailed out companies such as Bank of America, AIG and others.