Fed eyes wide-ranging bank pay rules to fight risk

Read it here: http://bit.ly/17WRpQ

The Federal Reserve plans new rules on bank pay to curb the type of excessive risk-taking that sparked the global financial crisis and triggered international demands for action....

Go, Bernanke/Obama, go! Finally, someone who's willing to challenge the self-serving status quo - the banks themselves will never do it. Indeed, it's a classic collective action problem - even if many banks change their compensation policies, they will be undermined by those that don't. The government has to intervene in a case like this.

A Fed source said on Friday that guidelines would be proposed in the next few weeks and would apply to any employee able to take risks that could imperil an institution, not just the executives who have been the main target of popular ire.

The rules will be aimed at all firms the Fed regulates and be enforceable under its existing powers, said the source, who requested anonymity. The Fed oversees more than 5,000 bank holding companies and over 800 smaller state-chartered banks.

Amen. All I can say to this really is about time!!

And as for the industry lobby group spokesman, why doesn't anyone even listen to these guys??

"What we're worried about is if they place undue restrictions on the sales people because that could weaken the company itself," said Scott Talbott, senior vice president for government affairs for the Financial Services Roundtable, the industry's lobbying group.

Whatever, buddy.