The paltry settlement amount and the fact that the executives will likely be paying very little from their own pockets come at a time of public outcry over how federal agencies have handled the misdeeds of financial firms that led to the financial crisis.
FDIC reaches $64 million settlement with 3 former Washington Mutual executives
The Federal Deposit Insurance Corp. has reached a settlement worth $64 million with three former executives who ran Washington Mutual, the largest bank to fail in U.S. history.
The settlement, which hasn’t been announced publicly yet, was made with the bank’s three top executives: former CEO Kerry Killinger, former chief operating officer Stephen Rotella and former chief of home loans David Schneider. The settlement amount of $64 million is mostly made up of the executives giving up claims to golden parachutes, bonuses and retirement funds, rather than cash that the executives have to pay.
It is also just a fraction of the $900 million the FDIC had sought to recover in a suit filed in March. The agency had accused the executives of gross negligence and reckless disregard for the long-term safety of the bank.
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