In a flurry of rule-making, six government agencies have re-proposed sweeping incentive-based compensation reforms under Section 956 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Once the new rules are finalized, they will apply to banks and bank holding companies, registered broker-dealers, investment advisers, credit unions, Fannie Mae and Freddie Mac, and certain other domestic operations of foreign entities.
The new rules would impose significant new restrictions and requirements for incentive-based compensation arrangements sponsored by covered institutions. These include deferral, forfeiture and clawback requirements, as well as extensive new governance and recordkeeping requirements.
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