|
|
The Text of the Dodd-Frank Act
International Association of
Risk and Compliance Professionals (IARCP)
Dodd Frank Act Section 956
SEC. 956. ENHANCED COMPENSATION STRUCTURE
REPORTING.
(a) ENHANCED DISCLOSURE AND REPORTING OF
COMPENSATION ARRANGEMENTS.—
(1) IN GENERAL.—Not
later than 9 months after the date of enactment of this title, the
appropriate Federal regulators jointly shall prescribe regulations
or guidelines to require each covered financial institution to
disclose to the appropriate Federal regulator the structures of
all incentive-based compensation arrangements offered by such
covered financial institutions sufficient to determine whether the
compensation structure—
(A) provides an executive officer,
employee, director, or principal shareholder of the covered
financial institution with excessive compensation, fees, or
benefits; or
(B) could lead to material financial loss to
the covered financial institution.
(2)
RULES OF CONSTRUCTION.—Nothing in
this section shall be construed as requiring the reporting of the
actual compensation of particular individuals. Nothing in this
section shall be construed to require a covered financial
institution that does not have an incentive-based payment
arrangement to make the disclosures required under this
subsection.
(b) PROHIBITION ON
CERTAIN COMPENSATION ARRANGEMENTS.—
Not later than 9
months after the date of enactment of this title, the appropriate
Federal regulators shall jointly prescribe regulations or
guidelines that prohibit any types of incentive-based payment
arrangement, or any feature of any such arrangement, that the
regulators determine encourages inappropriate risks by covered
financial institutions—
(1) by providing an executive
officer, employee, director, or principal shareholder of the
covered financial institution with excessive compensation, fees,
or benefits; or
(2) that could lead to material financial
loss to the covered financial institution.
(c)
STANDARDS.—The appropriate Federal
regulators shall—
(1) ensure that any standards for
compensation established under subsections (a) or (b) are
comparable to the standards established under section of the
Federal Deposit Insurance Act (12 U.S.C. 2 1831p–1) for insured
depository institutions; and
(2) in establishing such
standards under such subsections, take into consideration the
compensation standards described in section 39(c) of the Federal
Deposit Insurance Act (12 U.S.C. 1831p– 9 1(c)).
(d)
ENFORCEMENT.—The provisions of this
section and the regulations issued under this section shall be
enforced under section 505 of the Gramm-Leach-Bliley Act and, for
purposes of such section, a violation of this section or such
regulations shall be treated as a violation of subtitle A of title
V of such Act.
(e) DEFINITIONS.—As
used in this section—
(1) the term ‘‘appropriate Federal
regulator’’ means the Board of Governors of the Federal Reserve
System, the Office of the Comptroller of the Currency, the Board
of Directors of the Federal Deposit Insurance Corporation, the
Director of the Office of Thrift Supervision, the National Credit
Union Administration Board, the Securities and Exchange
Commission, the Federal Housing Finance Agency; and
(2) the
term ‘‘covered financial institution’’ means—
(A) a
depository institution or depository institution holding company,
as such terms are defined in section 3 of the Federal Deposit
Insurance Act (12 U.S.C. 1813);
(B) a broker-dealer
registered under section 15 of the Securities Exchange Act of 1934
(15 U.S.C. 78o);
(C) a credit union, as described in
section 19(b)(1)(A)(iv) of the Federal Reserve Act;
(D) an
investment advisor, as such term is defined in section 202(a)(11)
of the Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)(11));
(E) the Federal National Mortgage Association;
(F) the
Federal Home Loan Mortgage Corporation; and
(G) any other
financial institution that the appropriate Federal regulators,
jointly, by rule, determine should be treated as a covered
financial institution for purposes of this section.
(f)
EXEMPTION FOR CERTAIN FINANCIAL INSTITUTIONS.—The
requirements of this section shall not apply to covered financial
institutions with assets of less than $1,000,000,000
Return to Index
Return to the Table of Contents
Visit the
international Association of Risk and Compliance Professionals
(IARCP)
|
|
|
