This bill requires the Federal Deposit Insurance Corporation (FDIC) to claw back compensation paid to certain responsible parties when an insured depository institution is placed into FDIC receivership.
Specifically, all or part of the compensation paid the previous five years to an institution-affiliated party responsible for the condition of the institution must be paid to FDIC to prevent unjust enrichment and to assure that the party bears losses consistent with their responsibility. Compensation includes salary, bonuses, awards, and profits from buying or selling securities.
The bill also expands the authority of the FDIC to claw back compensation of parties responsible for financial losses incurred by a financial company regardless of the process by which FDIC is appointed receiver.
Finally, the bill establishes that the creditors and shareholders of an insured depository institution's holding company are responsible for the losses when the institution is resolved by the FDIC.
