Washington, D.C.--Congressman Eliot Engel voted to protect American taxpayers and shareholders from the excessive compensation paid executives at big financial firms. The excessive compensation is paid despite their failed business practices which contributed to the collapse of the financial markets last fall. The Corporate and Financial Institution Compensation Fairness Act (HR 3269), passed Friday by a vote of 237 to 185 in the full House, is the second piece of a larger regulatory reform package the House will continue to take up this year to rebuild our economy and restore faith in our financial system.

“For years, excessive compensation encouraged risky behavior and gambling with our financial future. Last fall’s collapse was the result of years of reckless choices,” said Rep. Engel. “The taxpayers helped rescue the financial industry and, at the same time, save our economy from further danger. Millions of Americans are still struggling to make ends meet, making it patently unfair for these same executives who triggered this crisis to be excessively compensated. This legislation will prevent that.”

The measure ends the incentives which rewarded executives at large financial firms for the dangerous risks taken and the poor performance of their firms, all taken at the expense of their employees and shareholders. It requires federal regulators to monitor inappropriate or risky compensation practices and compels large financial firms to disclose any compensation structures that include incentive-based elements. The bill also gives shareholders at public companies a greater say in setting the pay for top executives.

“This bill is an important step along the path of creating an American economy sustainable for the 21st Century. This is joined by our desperate need for health care reform and energy policy. It is all part of our broader economic strategy,” said Rep. Engel. “Regulatory reform is absolutely crucial to making our system stronger than before. Responsibility by our financial industry must be a part of this system.”