• / Free eNewsletters & Magazine
  • / My Account
Home>UPDATE: Senators press SEC chairman on Dodd-Frank clawbacks, but Equifax execs ineligible

UPDATE: Senators press SEC chairman on Dodd-Frank clawbacks, but Equifax execs ineligible

UPDATE: Senators press SEC chairman on Dodd-Frank clawbacks, but Equifax execs ineligible

09/27/2017

By Francine McKenna, MarketWatch

Clawback rules require a material financial restatement, which isn't going to happen at Equifax

Senate Banking Committee members had a lot of questions for Jay Clayton, the Securities and Exchange Commission chairman, on Tuesday, but several senators switched gears to ask about compensation clawbacks after news broke that Equifax CEO Richard Smith was retiring.

Equifax (EFX) disclosed on Sept.7 that criminals had exploited a flaw in its website to gain access to confidential data about 143 million consumers. An Equifax spokesperson told MarketWatch that Smith, whose retirement is effective immediately, won't receive a "package" to retire and will not receive a 2017 bonus based on the company's performance. Smith received bonuses of about $3 million a year in 2016 and 2015 .

Smith will also will not receive severance pay, which could have been as much as $5 million. However, Smith will still receive some $18.3 million in pension benefits he is entitled to under any circumstance, according to the spokesperson.

Read:After breach, Equifax CEO leaves with $18 million pension, and possibly more (http://www.marketwatch.com/story/equifax-ceo-leaves-with-18-million-pension-and-maybe-more-2017-09-26)

Sen. Elizabeth Warren, the Democrat from Massachusetts, was more focused during the hearing on Clayton's call for more IPOs, but after the hearing she issued a statement about Equifax and Smith. "I've called for Equifax executives to be held accountable for their role in failing to stop this data breach and hiding it from the public for forty days," said Warren. "It's not real accountability if the CEO resigns without giving back a nickel in pay and without publicly answering questions."

Smith, who the board said would retire as of Tuesday, was expected to appear before the House Energy Committee and Senate Banking Committee next week.

©2017 Morningstar Advisor. All right reserved.