New York Attorney General has issued a 22 page white paper entitled: "No Rhyme or Reason: The 'Heads I Win, Tails You Lose' Bank Bonus Culture."
This reports how banks pay out huge bonuses when they make money and also pay out huge bonuses when they lose money. Joe Wiesenthal, Editor of Clusterstock, highlights the following quote from the Cuomo report:
...One thing is clear from this investigation to date: there is no clear rhyme or reason to the way banks compensate and reward their employees. In many ways, the past three years have provided a virtual laboratory in which to test the hypothesis that compensation in the financial industry was performance-based. But even a cursory examination of the data suggests that in these challenging economic times, compensation for bank employees has become unmoored from the banks' financial performance.
Thus, when the banks did well, their employees were paid well. When the banks did poorly, their employees were paid well. And when the banks did very poorly, they were bailed out by taxpayers and their employees were still paid well. Bonuses and overall compensation did not vary significantly as profits diminished.Read Joe's comments and access the full Cuomo report here.