Press Releases

Bachus: Jan. 22 Committee Hearing Must Examine Pay Of Fannie and Freddie Executives


WASHINGTON, January 13, 2010 -  

January 13, 2010

- Congressman Spencer Bachus, the top Republican on the Financial Services Committee, issued the following statement in response to Chairman Barney Frank's comments announcing a Jan. 22 hearing on compensation. 

"Hearings that seek to examine ways to reduce the risk of excessive compensation in our financial system must begin at Fannie Mae and Freddie Mac.  These institutions, which were at the center of the mortgage market meltdown that caused the financial crisis, are more than 80% owned by the taxpayers and controlled by the U.S. Government, and have cost taxpayers well over $100 billion to date.

"It is inconceivable to me that, after these institutions have been given access to unlimited taxpayer funds to cover loses they have incurred as a result of their reckless behavior, their top executives would each be awarded multi-million dollar compensation packages, payable in cash rather than in the type of long-term performance-based stock options that have characterized compensation arrangements at other large financial institutions that have received extraordinary government assistance.

"Under the compensation arrangement announced by the Treasury Department on Christmas Eve, the CEOs of Fannie Mae and Freddie Mac will make at least $6 million for 2009, which is 15 times more than the President and 30 times more than a cabinet secretary.  At the hearing, the Committee must explore how these compensation arrangements can be justified in light of the companies' abject failure to meet their stated performance goals, which include ‘being a recognized leader in the housing recovery' and ‘protecting taxpayers.'"

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