The Missing Week #3: Legislation

On May 20th, the President signed FERA, or the Fraud Enforcement and Recovery Act of 2009, and it became Public Law 111-21. As noted by Gibson Dunn in this post on the Harvard Corporate Governance Blog, language creating a financial crisis investigating committee made its way into the final verison. Also worth a look is Gibson Dunn's financial crisis update page.

On the same day, the President also signed the Helping Families Save Their Homes Act of 2009 (now Public Law 111-22). Besides combatting foreclosure, the law contains restrictions, including conflict of interest rules, on investors wishing to participate in the PPIP program. For more detail, see this post on Jim Hamilton's World of Securities Regulation blog.

Sticking with Jim Hamilton for the moment - he also notes that Richard Durbin proposed a bill called the The Excessive Pay Shareholder Approval Act (S. 1006) which would amend the '34 Act to require super-majority shareholder approval of compensation that is more than 100 times average employee compensation. So, there you go - that's the defintion of excessive.