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SEC and other organizations propose guidance on incentive-based compensation arrangements

  • SEC document Image

May 06, 2016

The SEC and several other government agencies, including the OCC, FDIC, FHFA, and NCUA, have issued a joint proposal, “Incentive-Based Compensation Arrangements,” to implement Section 956 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

The proposed rule would:

  • Prohibit “incentive-based payment arrangements that the Agencies determine encourage inappropriate risks by certain financial institutions by providing excessive compensation or that could lead to material financial loss.”
  • Require “financial institutions to disclose information concerning incentive-based compensation arrangements to the appropriate Federal regulator.”

Comments are due by July 22, 2016. For more information, see the proposed rule on the SEC’s Web site.

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