Wall Street opponents are subjecting to renewed scrutiny the former Goldman Sachs executive tapped to serve as chief of staff at the Securities and Exchange Commission.
The AFL-CIO on Tuesday wrote to SEC Chair Mary Jo White demanding to know what sort of perks Andrew Donohue received when he left the Wall Street titan for a job as a regulator. His appointment was announced on May 28 and he began work Monday.
The union’s director of the office of investment, Heather Slavkin Corzo, asked White to “immediately disclose if he will receive a golden parachute from Goldman Sachs for entering into government service, and if so, the dollar amount of these payments.”
Such disclosures are required under the law within 30 days of starting work, but critics want White to share that information now.
Of particular interest to opponents of Donohue’s appointment is the Stock Incentive Plan at Goldman Sachs. It reportedly has a clause allowing the accelerated vesting of stock awards or equivalent cash payments when a Goldman exec resigns to enter government service.
“To our knowledge, government service golden parachutes are only common at Wall Street firms,” Slavkin Corzo wrote. “At most other public companies, equity compensation awards vest over a period of time to compensate executives for their labor during the commensurate period. If an executive resigns or is terminated for good reason before the vesting period is satisfied, any unvested awards are usually forfeited.”
The SEC regulates Wall Street firms such as Goldman Sachs, although not from the standpoint of safety and soundness, but rather investor protection. Receiving so-called golden parachutes before leaving to join an agency that will regulate the very firm they just left raises “troubling public policy questions,” Slavkin Corzo wrote.