Cuomo Says Significant Bonus for Thain Not Justified
NEW YORK -- New York Attorney General Andrew Cuomo said significant bonuses this year for Merrill Lynch & Co. Chief Executive John Thain and other executives are unjustified given the firm's financial performance.
In a letter to the investment bank's board of directors, Mr. Cuomo said reports that Mr. Thain is seeking a 2008 bonus of as much as $10 million is "nothing less than shocking."
Utilizing the company's own criteria, a bonus of this size appears to be unjustified, said Mr. Cuomo, saying the company has lost more than $11 billion for the year as a whole.
"Indeed, Merrill's decision to be taken over by Bank of America seems to have been the only thing that saved Merrill from collapse," Mr. Cuomo said. "Clearly, the performance of Merrill's top executives throughout Merrill's abysmal year in no way justifies significant bonuses for its top executives, including the CEO."
That is probably quite true, but why in the world is the New York state attoney general trying to get involved with the compensation structure of a private employer?