Subject: File No. S7-12-11
From: John Despard

May 31, 2011

Elizabeth Murphy
100 F Street, NE
Washington, DC 20549

Dear Murphy,

America paid a terrible economic price because of irresponsible risk-taking by Wall Street executives. Those executives took those risks because they knew that they could walk away with billions of dollars in bonuses and stock options and never pay for the long-term consequences of their actions. We need tough rules so that Wall Street pay packages don't encourage short-term risk taking.

Your rules should require at least a five year deferral period for executive bonuses at big banks, ban executive hedging of their pay packages, and require specific details from banks on precisely how they ensure that executives will share in the long-run risks created by their decisions. It should apply to the full range of important financial institutions, and draw in all the key executives at those companies.

Once this rule is passed, only you will know the details of its enforcement. But it's important for the public to know the progress you are making on this vital issue. You should report back to the public annually with a detailed report on progress in creating accountability for Wall Street pay.

Personally, I don't understand "big finance" like this.  I'm just a poor high school graduate who's never earned more than $20,000 a year.  My only personal comments on this are that taxpayers should not be required to cover their mistakes to keep these large banks, etc.
from failing.  As I understand it over a trillion dollars of tax payer money went to cover their mistakes while we are now being told there is not enough for medicare, Social Security, etc.  What ever regulatory actions are taken they should include a requirement of bonds being placed by these people making these risk taking decisions that if they prove to be failures that the risk takers not the taxpayers are held responsible.  I feel regulators should set an amount (no more than the President's salary ($400,000) that anything in excess of this is at risk of recovery by those hurt if the gamble fails. There would be no statute of limitations on this.

Referencing Docket No.'s:

OTS:   RIN 155-AC49
OCC:  RIN 1557-AD39
Fed:    RIN 7100-AD69
SEC:   RIN 3235-AL06
FHFA: RIN 2590-AA42
FDIC:  RIN 3064-AD56


Mr. john despard