sec rules. >> have you ever found that to be violated in the history of the sec or the law? >> unfortunately i don't have that information, to be able to give you a thoughtful answer. i would be happy to look into that. certainly the commission takes its authority to enforce the rules with regard to violations of the did the disclosure rules or other rules very seriously but i would be happy to give back to you with information on that. ..

it won't be left as the only one doing it, and that will improve the practices of everyone. >> do you think it would make any sense just to impute culpability to stockholders and their losses if you act poorly like this, that opening the exposure to liability could be just as effective? >> shareholders already do share

when there is excessive bonuses paid to executives that's cost or worn by shareholders and their success of risks -- >> when was the last time that you were aware that was utilized? >> well, the shareholders -- it's reflected in the decreasing shareholding. >> i & the pherae but most stockholders that i know, and they are small investors, not a big investors, they think these que ljungqvist bonuses are a necessary evil and there is nothing they can do about them and it's just as bad one place as another when everybody is misbehaving they are not went find anything better at the bottom line if everybody is misbehaving to the same extent and nobody's done anything about it and quite frankly i doubt you are going to be able to regulate anybody into doing that. i think just holding them more accountable individually and personally liable and accountable would just make a little bit more sense. mr. sperling, i would like your

2 cents worth. >> i think the proposals we are talking about would be effective. i agree with mr. alvarez is a bit about -- and you see this the way the consultant works -- it is simply -- it's not -- there is less is this fundamentally sound, fundamentally good for the shareholder and for how does it compare to the practices of your peers. and so you do get a bit of a collective action where people say our five competitors to this and that becomes the beginning and end of the discussion, and i think that in power in compensation committees but also to say on page bringing this to light does have a powerful deterrent on say in the u.k. even from the study business school it was a positive affect on the tour in high payouts to those that perform pour early. >> we have another subcommittee

hearing, so we will take a break and we'll have to votes so won't be gone that long. and will take your questions and then break for the vote. >> many years ago my husband worked in wall street. he started out in wall street i believe when he was 17 and he worked his way up and worked for a large financial service company. he was in compliance and had the whole northeast corridor to good of offices to make sure they were complying with the sec rules but also the company rules and he always found it amazing because he never announced when he was going to be there he would go into an office and a lot of them followed all the rules and regulations, no problems but there were certain offices that didn't follow the rules and regulations and he would write them up and another surprise visit back to see if they cleaned everything up.

they did not if that is when they got in trouble with the company and these are usually large offices that produced a lot of money for that particular location and i think that when we talk about why we're here today and we are doing i think people have forgotten the are here because the companies did what they did and are trying to get a reputation back. the banks to get the reputation back. the financial services have to get the reputation back and people do not trust them yet and it is our responsibility as the government to try to protect our constituents. they've lost trillions of dollars. people are hurting and still hurting. we are happy to see things are starting to go forward. i believe because of the

government did that the markets are starting to stabilize and we have still got a long way to go on housing and it's because of what we did do. with that being said and i have to agree with my colleague when she mentioned kenneth feinberg, he's great. i worked with him with a lot of my constituents that lost somebody on 9/11 and i think he was a great choice, but i go back to one of the articles will st. are beginning to voluntarily change practices though it remains to be seen how long and that is a reason we are doing what we are doing today and for the future but my question for you would be can you expand what is considered exceptional assistance? i don't understand that part. >> the easiest way to describe would be the previous administration was set up the capitol purchase program and

this was expanded to all banks even smaller banks could, and and the idea was to try to give more banks the capitol so they were in a stronger position to lend, not because we were in each of those banks but we felt collectively if there was stronger capitalization there would be more lending and it would be good for the economy and individual banks might say we're going to weather the storm buy not lending, we are going to make much money but we will get through it. for us we know 5,000 banks to that at the same time that means there's going to be less small-business lending and there's going to be less growth and this recession will last longer, so that is a generally accessible program. and the people who come to wait don't necessarily come because they are weak but because we have a policy goal allowing banks to have more capital. compare that to perhaps

citigroup where the required government assistance for their fundamental financial stability, and because of their importance to the overall financial stability in the economy and the desire to let something like lehman brothers happen, we make exceptional effort. we make an exceptional assistance they get. it is not available to their peers and it isn't based in a general goal, it is based on an exceptional intervention to assist them and essentially in their fundamental financial stability that is a different situation and i think that principle is one people understand. i think people understand there is something different about a on eg and citigroup and gm in the community bank that takes more capital and the capitol purchase program and i want to make clear fall of the land that was passed in the recovery act applies to everyone so the restrictions on bonuses we added

provisions on luxury expenditure, say on page, having to write in the narrative way of the risk analysis is but we were not as interested in the situations because many of those banks are the community banks in your district where you were giving taxpayer dollars to a company that would have gone into bankruptcy if they were not systemically sycophant. we feel a higher obligation and that really is in many ways the fundamental -- >> my husband actually believed nobody should give bonuses, just a good paycheck. >> we are going to return with the panel and i am going to call on the democratic side, only the members that are here and didn't get to ask questions. new members will get to question the second panel. the five members who didn't get to ask will be called on, finished this panel and we will then get to the next panel and one or two republicans. we will not be gone more than 25 minutes. there are only two votes. we will be back out soon as we