It looks like we’ve got another bonus scandal in our hands.
AIG drew the ire of taxpayers after it handed top executives huge millions in bonuses despite receiving billions in bail out funds from the government. Now, a study by New York Attorney General Andrew Cuomo claims that top banks handed out big bonuses despite doing poorly themselves.
In an analysis of compensation practices of the original nine banks that received money under the Troubled Asset Relief Program, or TARP, most financial firms paid out compensation that was nowhere close to their overall yearly performance.
Citigroup took a $27 billion loss in 2008 handed out $5.33 billion in bonuses. Citigroup is one of the government’s biggest bail out recipients with $45 billion in taxpayer’s money.
Other banks Goldman Sachs are on their way to pay back the government handed out around $4.8 billion in bonuses despite pulling in just $2.3 billion. JPMorgan Chase and Morgan Stanley also took similar routes – handing out bonses more than their profits.
“When the banks did well, their employees were paid well. When the banks did poorly, their employees were paid well,” said Cuomo. “And when the banks did very poorly, they were bailed out by taxpayers and their employees were still paid well.”
Source: CNN
