A new Securities and Exchange Commission rule that would allow the agency to reclaim bonuses from certain executives should not discourage companies from going public, SEC Chair Gary Gensler said Friday.
The “clawback rule” broadens SEC regulators’ authority to recover incentive-based compensation to current and former executives of public companies that was awarded based on errors in their financial statements. Gensler told CNBC’s “Squawk Box” that the agency is following through on a rule mandated by Congress.
“This was a straightforward thing that Congress said,” Gensler said. “If you’ve got the wrong faulty financials and somebody’s getting paid on those faulty financials, then they ought not keep the money. I think it’s pretty straightforward.”
‘Enforcement 40’ for 2020
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