,i #aaith ,,congress #b;d ,session ,h4 ,r4 #idij ,,in ,,the ,,house ,,of ,,representatives ,june #be1 #bjbf,ms4 ,tlaib 7for herself1 ,mr4 ,lynch1 ,ms4 ,lee of ,pennsylvania1 and ,mr4 ,green of ,texas7 introduced the following bill2 which was referred to the ,committee on ,financial ,services ,a ,,bill ,to defer part of the compensation of senior employees of large financial institutions 7and their subsidiaries71 to use such deferred amounts to pay any civil or criminal fines that may be levied on the institution 7or subsidiary71 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,bank ,failure ,accountability ,act4 #b4 ,findings ,congress finds the following3 7#a7 ,going back at least to the ,wall ,street crash of #aibi1 improper pay structures have contributed to financial crises in the ,united ,states4 7#b7 ,widespread financial misconduct led to the #bjjh financial crisis1 which caused the ,great ,recession4 ,compensation structures incentivized executives and employees to pursue short-term profits without regard for long-term risks to their firms or the broader financial system4 ,while culpable employees and executives continued to receive extraordinary pay1 homeowners1 workers1 and communities paid the price for their greed and recklessness4 7#c7 ,as seen in the #bjbc banking failures1 misaligned incentives within the financial sector continue to fail to hold executives and their senior employees accountable for their actions4 ,silicon ,valley ,bank ,,ceo ,greg ,becker enjoyed millions of dollars in incentive-based bonuses1 while his bank mismanaged risks and failed to respond to regulator's warnings4 ,in the hours before the failure of ,silicon ,valley ,bank1 managers paid themselves millions of dollars for what they deemed to be superior performance4 7#d7 ,employees in the financial sector continue to walk away with generous bonuses while their firms break the law and undermine the stability of the financial system4 ,compensation incentives that promote inappropriate risk-taking are a threat to economic security4 #c4 ,deferment of senior employee compensation 7a7 ,deferment fund ,each covered financial institution and each subsidiary of a covered financial institution shall establish a deferment fund1 which shall-- 7#a7 only contain compensation deferred under subsection 7b72 and 7#b7 only be used as permitted by this section4 7b7 ,deferment of compensation ,each covered financial institution and each subsidiary of a covered financial institution shall-- 7#a7 each year1 defer the compensation of each senior employee of the covered financial institution or subsidiary in an amount equal to at least #ej percent of the amount that the employee's total compensation for the year exceeds #g times the compensation of the median paid employee of the consolidated financial institution for the year2 7#b7 place all compensation deferred under paragraph 7#a7 into the deferment fund of the covered financial institution or subsidiary2 and 7#c7 after the end of the covered deferment period1 if sufficient funds remain in the deferment fund1 pay the senior employee the amount of compensation deferred and for which the covered deferment period ended4 7c7 ,use of deferment fund 7#a7 ,use of fund to pay fines ,if a covered financial institution or subsidiary of a covered financial institution is subject to a civil or criminal fine1 the covered financial institution or subsidiary shall first pay such fine out of amounts contained in the deferment fund of the covered financial institution or subsidiary4 7#b7 ,use of funds to make depositors whole ,if a covered financial institution is a depository institution or a credit union and the depository institution or credit union fails1 the depository institution or credit union shall use amounts in the deferment fund of the depository institution or credit union to ensure depositors do not lose any of their deposits4 ,all amounts in the deferment fund shall be used before any amounts are paid from the ,deposit ,insurance ,fund or the ,national ,credit ,union ,share ,insurance ,fund1 as applicable1 for such purpose4 7d7 ,cancellation of compensation that cannot be paid from deferment fund ,each covered financial institution or subsidiary shall have in place a policy that cancels any compensation deferred under subsection 7b7 that cannot be repaid as described under subsection 7b77#c71 due to the deferment fund lacking sufficient funds4 7e7 ,treatment of deferred compensation of ex-,employees ,with respect to an individual that has compensation deferred pursuant to subsection 7b71 but is no longer employed by the applicable covered financial institution or subsidiary1 if the covered financial institution or subsidiary is required to pay a fine from its deferment fund for misconduct that occurred after the individual was no longer employed by the covered financial institution or subsidiary1 the covered financial institution or subsidiary shall segregate the individual's deferred compensation from other amounts in the deferment fund and shall not use such segregated amounts for any purpose other than repaying the individual pursuant to subsection 7b77#c7 or for the payment of another fine for misconduct that occurred while the individual was still employed by the covered financial institution or subsidiary4 7f7 ,rulemaking ,the ,board of ,governors of the ,federal ,reserve ,system1 the ,comptroller of the ,currency1 the ,federal ,deposit ,insurance ,corporation1 the ,federal ,housing ,finance ,agency1 the ,national ,credit ,union ,administration1 and the ,securities and ,exchange ,commission may each issue such rules as may be necessary to carry out this section with respect to covered financial institutions and subsidiaries subject to supervision by the agency4 7g7 ,definitions ,in this section3 7#a7 ,appropriate ,federal regulator ,the term appropriate ,federal regulator means-- 7,a7 the appropriate ,federal banking agency1 as defined under section #c of the ,federal ,deposit ,insurance ,act2 7,b7 the ,federal ,housing ,finance ,agency1 in the case of the ,federal ,national ,mortgage ,association or the ,federal ,home ,loan ,mortgage ,corporation2 7,c7 the ,national ,credit ,union ,administration1 in the case of a credit union described under paragraph 7#f77;,c72 and 7,d7 the ,securities and ,exchange ,commission1 in the case of a person described under subparagraph 7,b7 or 7,d7 of paragraph 7#f74 7#b7 ,compensation ,with respect to an employee1 the term compensation means any financial remuneration1 including salary1 bonuses1 incentives1 benefits1 severance1 deferred compensation1 or golden parachute benefits1 and any profits that would be realized from the sale of the securities of the company employing the employee4 7#c7 ,consolidated financial institution ,with respect to a financial institution1 the term consolidated financial institution means the financial institution and all subsidiaries of the financial institution4 7#d7 ,covered deferment period ,the term covered deferment period means-- 7,a7 with respect to a covered financial institution with less than #aj1jjj1jjj1jjj in consolidated assets1 a number of years1 to be determined by the appropriate ,federal regulator if determined necessary by such appropriate ,federal regulator1 beginning on the date the compensation is deferred2 7,b7 with respect to a covered financial institution with #aj1jjj1jjj1jjj or more1 but less than #ej1jjj1jjj1jjj1 in consolidated assets1 #b years beginning on the date the compensation is deferred2 7,c7 with respect to a covered financial institution with #ej1jjj1jjj1jjj or more1 but less than #bej1jjj1jjj1jjj1 in consolidated assets1 #f years beginning on the date the compensation is deferred2 and 7,d7 with respect to a covered financial institution with #bej1jjj1jjj1jjj or more in consolidated assets1 #h years beginning on the date the compensation is deferred4 7#e7 ,covered financial institution ,the term covered financial institution means a financial institution with more than #a1jjj1jjj1jjj in consolidated assets4 7#f7 ,financial institution ,the term financial institution means-- 7,a7 a depository institution or depository institution holding company1 as such terms are defined1 respectively1 in section #c of the ,federal ,deposit ,insurance ,act 7#ab ,u4,s4,c4 #ahac72 7,b7 a broker or a dealer registered under section #ae of the ,securities ,exchange ,act of #aicd 7#ae ,u4,s4,c4 #gho72 7,c7 a credit union1 as described in section #ai7;b77#a77;,a77iv7 of the ,federal ,reserve ,act2 7,d7 an investment adviser1 as defined in section #bjb7;a7 of the ,investment ,advisers ,act of #aidj 7#ae ,u4,s4,c4 #hj;b-#b7;a772 7,e7 the ,federal ,national ,mortgage ,association2 and 7,f7 the ,federal ,home ,loan ,mortgage ,corporation4 7#g7 ,senior employee ,the term senior employee means an employee of a covered financial institution or a subsidiary of the covered financial institution who-- 7,a7 is a senior executive officer2 7,b7 has total annual compensation of more than #a1jjj1jjj2 7,c7 with respect to a covered financial institution with #ej1jjj1jjj1jjj or more1 but less than #bej1jjj1jjj1jjj1 in consolidated assets-- 7i7 is in the top #b percent of the most highly compensated employees in the consolidated financial institution2 or 7ii7 has the authority to commit or expose #j4e percent or more of the capital of the consolidated financial institution2 or 7,d7 with respect to a covered financial institution with #bej1jjj1jjj1jjj or more in consolidated assets-- 7i7 is in the top #e percent of the most highly compensated employees in the consolidated financial institution2 or 7ii7 has the authority to commit or expose #j4e percent or more of the capital of the consolidated financial institution4