FDIC Allows for Pay Clawbacks

The Wall Street Journal reports:

The Federal Deposit Insurance Corp., in Chairman Sheila Bair's last meeting at the helm, on Wednesday approved rules allowing the government to recover compensation from executives who cause a financial firm to collapse.

The rules, approved in a 5-0 vote, were required by the Dodd-Frank financial overhaul passed last year. They authorize the FDIC to recover two years worth of payments made to senior executives and directors who are deemed "substantially responsible" for a firm's failure.