S.E.C. Proposes Crackdown on Wall Street Bonuses

By BEN PROTESS
NYT

Lavish Wall Street bonuses, long the scorn of lawmakers and shareholders, have met a new foe: the Securities and Exchange Commission.

The agency is now proposing a crackdown on hefty compensation at big banks, brokerage firms and hedge funds — a move intended to rein in pay packages that encouraged excessive risk-taking before the financial crisis. The proposal would require Wall Street firms to disclose bonus figures to the S.E.C., which could then ban any “excessive” awards.

The plan was among several new regulations the agency proposed on Wednesday as part of the Dodd-Frank financial overhaul law. Other proposals included rules for derivatives clearinghouses and a measure to limit the influence credit rating agencies have on the financial industry.

The agency’s commissioners, in a 3-to-2 vote on Wednesday, agreed to move forward with the Wall Street bonus rules. The proposal will now enter a 45-day public comment period, after which the commissioners must vote on a final version of the rules.

(More here.)