The following is a fictitious scenario:
An attorney working 5 years at Formaldehyde, a start up in Silicon Valley, rolls in $170K+/year. It's spot on what they say in school on "A" students becoming professors, "B" students becoming judges, and "C" students making money. Who would have guessed earning a 1.8 GPA and not even knowing what "res judicata" means could lead to a house in the sun just 5 years after graduation.
What a "cool" life Andy says. Andy moved to the Aptos neighborhood two years ago after selling the townhouse he bought following his divorce. Aptos is a small town in Santa Cruz County popular for freeride biking. On first meeting, it is surprising Andy ever married. He is short tempered. One minute he's soft, advertising in a local paper about giving thanks to a guy at the Carmel Mission, one of nine missions along California's Central Coast. The next minute he's yelling, never apologizing. He has a mean face, forehead lines, and thinks he can read someone's mind by staring with his big brown eyes. He's usually wrong, and it sucks when someone misinterprets.
In poor economic times there is room for negative misinterpretations, with compensation at financial institutions after the U.S. government bailed out companies coming under scrutiny.
Lawsuits accuse Goldman Sachs of wasting shareholder money by paying out huge bonuses to its employees. Bonuses paid to Merrill Lynch & Co. executives before Bank of America completed its takeover in January 2009 prompted federal and state probes and a shareholder revolt that stripped Chief Executive Officer Kenneth D. Lewis of the chairman's title.
The questioning of executive compensation has led the SEC to release rules enhancing required proxy statement and Form 10-K information on executive compensation, director background and qualifications, potential compensation consultant conflicts of interest, risk assessment. In overview, the new rules require:
1. Disclosure of the company's compensation policies and practices as they relate to risk management.
2. Disclosure of the full grant date fair value of equity grants (in the Summary Compensation Table and Director Compensation Table).
3. Enhanced disclosure about directors and director nominees.
4. Discussion of the rationale for the board's leadership structure, and an explanation of the board's role in risk oversight.
5. Disclosures of compensation consultants' fees under certain conditions.
6. Faster reporting of the results of shareholder votes.
Huge government bailouts of financial institutions have been shouldered by the taxpayer who in turn has not seen any meaningful relief from the bailout. Banks in general have not become more cooperative when it comes to giving consumers a break with their mortgages despite receiving billions of dollars. The Bankruptcy Code provides protection and as such acts as a bailout for consumers who are overburdened by debt and are not given a break from their creditors. There is no need for the consumer to feel guilty about filing for bankruptcy. Large credit card companies treat bankruptcy only as the cost of doing business. Rinne Legal offers a FREE CONSULTATION on the bankruptcy process.
