Whoa, whoa, whoa. Let's not do anything rash or that could potentially deter people from committing fraud. In fact, this rule could actually encourage senior executives to commit fraud, as it will someway, somehow increase compensation (???).
Michael Piwowar, a Republican appointed by President Obama, quoted Yankee Hall of Famer Yogi Berra in ripping White’s proposal. “The future ain’t what it used to be,” Piwowar wrote in prepared remarks. While a “properly designed” rule could be good for investors, Piwowar said, this proposal falls short — and could hurt shareholders. “Unfortunately, the broad approach of today’s proposal is likely to impose a substantial commitment of shareholder resources and, unintentionally, result in a further increase in executive compensation,” he said. But Kara Stein, also an Obama SEC appointee who usually favors tougher bank regulation, said that clawbacks are nothing new in the wake of Enron, Lehman and WorldCom. “‘Clawing back’ ill-gotten compensation is not a new concept,” she said.