By Ronald D. Orol
http://www.marketwatch.com/story/government-czar-begins-pay-review-for-top-bailouts-2009-09-01Government-appointed pay czar Kenneth Feinberg on Tuesday started a sixty-day clock to review the pay packages for top executives and employees at seven large financial institutions that have received $200 billion in taxpayer funds, and experts expect a crackdown on some of the perks and pricey packages.
The financial institutions submitted their current compensation plans to Washington attorney Feinberg, who the Treasury appointed in June to be the government's overseer of the pay packages of the top employees at Bank of America Corp., (BAC 16.50, +0.04, +0.24%) Citigroup Inc. (C 4.56, +0.02, +0.44%) and five other financial institutions that received substantial support from the government's $700 billion bailout package.
Feinberg sent a letter to all seven institutions Monday evening letting them know that the pay plans they submitted were deemed substantially complete, according to a Treasury official. As "pay czar" Feinberg can now cut pay packages for the top 25 paid executives and re-write the pay structures for the next 100 employees. Such pay structure changes could include bars on perquisites, commonly known as perks.
"Feinberg could say that he doesn't think it is appropriate for you to provide any perks whatsoever," said Laura Thatcher, partner and director of the executive compensation division at Alston & Bird in Atlanta, Ga., "That means prohibitions on corporate sponsored life insurance, pay for physicals, flying on company planes and more."
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