House panel to consider prohibition on bonus payment

WASHINGTON Thu Mar 19, 2009 9:23pm EDT

WASHINGTON (Reuters) - The House Financial Services Committee will consider legislation to prohibit any bonus payments by companies who have received government bailout funds, until investments are repaid in full, chairman Barney Frank said on Thursday.

The measure, to be considered next Tuesday, would prohibit any compensation arrangements that are unreasonable or excessive for these companies, the panel said in a statement.

The bill would also bar bailed-out companies from paying any bonus to any employee, regardless of when any bonus was agreed to, the statement said.

The panel said the full House of Representatives would be able to consider the legislation the following week.

In the face of public outrage over $165 million in bonuses that American International Group paid out after receiving $180 billion in government aid, the House on Thursday voted 328-93 to approve a 90 percent tax on bonuses for certain executives at companies that are getting taxpayer-financed help.

(Reporting by Joanne Allen; Editing by Gary Hill)

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