GS Sued Over Bonuses

Friday, January 08, 2010

Let the games begin:
Goldman Sachs was sued on Thursday by an Illinois pension fund seeking to recover billions of dollars of bonuses and other compensation being awarded for 2009, saying the payouts harm shareholders.

In a lawsuit filed in New York state supreme court in Manhattan on behalf of shareholders, the Central Laborers' Pension Fund said Goldman had by Sept. 25 set aside nearly $17 billion for compensation and might pay out more than $22 billion for the year. It said this "highlights the complete breakdown" of corporate oversight.

The lawsuit contends that Goldman's revenue for the year was artificially inflated by government bailouts of the banking industry and the insurer American International Group, as well as a change in Goldman's fiscal year.

Such sums, and Goldman's practice of continuing to pay out nearly 50 percent of net revenue as compensation, show "scant regard" for the interests of shareholders, it said... (CNBC)
Start of a new trend??


Steve Warshaw said...

This is fantastic. People are finally tired of the Geithner printing press feeding Goldman. I hope they win

Brandon Rowley said...

Agreed! Though it's not exactly unexpected and I'm surprised the gov't didn't see it coming. Give billions in cheap loans, create a steep yield curve...and then act surprised when bankers make money. Hmmmmm

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