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For Immediate Release: May 3, 2006

Contact:	Steve Adamske, 202-225-7141

DEMOCRATS TO FORCE THE ISSUE OF EXECUTIVE COMPENSATION

Minority invokes rules to force future hearing; Democrats denied witnesses for today's hearing

Washington, DC- All 33 minority members of the House Financial Services Committee signed a letter today to invoke Rule XI to force a Financial Services Committee hearing on the issue of executive compensation.  Democrats were denied the ability to call witnesses to today's hearing with Securities and Exchange Commission (SEC) Chairman Christopher Cox.  Financial Services Committee Chairman Mike Oxley denied a request by Ranking Democratic Member Barney Frank requesting a second panel to be dedicated to the issue of executive compensation.  The issue of executive pay is relevant because the SEC is currently in the middle of a rulemaking process to revise regulations regarding the disclosure of executive pay and so-called golden parachute pay packages.

"With the SEC joining those who recognize that executive pay has gotten out of control, which has adverse economic consequences, it is unacceptable for Congress to be silent," said Ranking Member Frank.  "Rule IX is rarely used, for good reason, because committees work best in a cooperative manner.  The Financial Services committee generally does so, but the issue of executive compensation is too important to be sacrificed."

Last year, Congressman Barney Frank introduced H.R. 4291 "The Protection Against Executive Compensation Abuse Act" to address the problem of runaway executive compensation by requiring greater disclosure of executive compensation to shareholders.  Frank's initiative would not set any artificial limits on individual executive compensation.  Rather, the legislation would give shareholders more information about management pay packages and require shareholder approval of executive compensation plans. The bill currently has 21 co-sponsors, and the bill is awaiting further action in the House Financial Services Committee.

Below is the text of the letter signed by a unanimous minority caucus:

May 3, 2006

The Honorable Michael G. Oxley

Chairman

Committee on Financial Services

U.S. House of Representatives

Washington, DC 20515

Dear Mr. Chairman:

We hereby notify you that pursuant to clause 2(j)(1) of Rule XI of the Rules of the House of Representatives, and clause (d)(5) of Rule 3 of the Rules for the Committee on Financial Services, we are exercising our right upon request to you to request an additional day of hearing with witnesses called by the minority on the matter of compensation for high-ranking public company employees.  This is a matter, as you know, that the Securities and Exchange Commission (SEC) is now addressing in a proposed rule as part of the agency's agenda, and that SEC Chairman Cox will address, although in a very limited manner, in testimony at today's hearing, which is entitled "Protecting Investors and Fostering Efficient Markets: A Review of the SEC Agenda."  As required by the aforementioned rules, this letter is signed by a majority of the Committee's minority.

Pursuant to our House Rule XI and Committee Rule 3 rights to call additional witnesses, we will forward to you subsequent to today's hearing a list of the witnesses to be invited to appear at this minority day of hearing.  We also reserve the right to call other witnesses to be identified by the Committee's minority prior to the additional day of hearing. 

Thank you for your attention to this request.

 

Click here to read more about Democratic action on Executive Compensation.

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The Committee oversees all components of the nation's housing and financial services sectors including banking, insurance, real estate, public and assisted housing, and securities. The Committee continually reviews the laws and programs relating to the U.S. Department of Housing and Urban Development, the Federal Reserve Bank, the Federal Deposit Insurance Corporation, Fannie Mae and Freddie Mac, and international development and finance agencies such as the World Bank and the International Monetary Fund. The Committee also ensures enforcement of housing and consumer protection laws such as the U.S. Housing Act, the Truth In Lending Act, the Housing and Community Development Act, the Fair Credit Reporting Act, the Real Estate Settlement Procedures Act, the Community Reinvestment Act, and financial privacy laws.