New York AG Andrew Cuomo has written a letter to nine financial institutions inquiring whether those institutions’ receipt of emergency federal money has changed those firms’ expected bonus payouts for “top management” for the winter of 2008-2009. Cuomo’s letter also asks the banks to outline past payments to employees who earned more than $250,000 in either 2006 or 2007.
“Obviously, we will have grave concerns if your expected bonus pool has increased in any way as a result of your receipt or expected receipt of taxpayer funds,” the letter notes.
As this half of FW has previously noted elsewhere, Cuomo, for the most part, has taken an admirable approach toward investigating Wall Street’s doings over the past few years. This inquiry is an extension of that approach.
Practically speaking, though, greater scrutiny of now-government-backed firms’ expected payouts could mean even lower bonuses than the up to 43-60 percent drop previously estimated.
Even lower bonuses mean wider deficits for New York City and State.