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Follow on Google News | American Express Company under investor investigation over alleged excessive payoutsInvestigation on behalf of current long term investors in American Express Company – AXP investors should contact the Shareholders Foundation, Inc. at mail@shareholdersfoundation.com
By: Shareholders Foundation, Inc. If you are a current long term investor in American Express Company stock, including those who purchased their AXP shares prior to 2007 and continue to currently hold their AXP shares, you have certain options and you should contact the Shareholders Foundation, Inc by email mail@shareholdersfoundation.com or call +1(858) 779 – 1554. Kenneth R. Feinberg, the Obama administration’ Mr. Feinberg determined that banks paid out $1.6 billion in unwarranted bonuses, retention awards, stock grants and "golden parachute" retirement packages to their top earners at the height of the financial crisis. American Express Company the bank holding company, located in New York, is among the 17 companies. Another of the other 16 companies was Citigroup, which was reportedly identified for having the most egregious compensation packages, according to government officials with knowledge of Mr. Feinberg’s report. Citigroup reportedly handed out several hundred million dollars in pay in 2008 as it neared collapse. Nearly two-thirds of the payouts amount to Andrew J. Hall, owner of a nearly 1000 year old German Medieval Castle, who reportedly received a payout of more than $100 million in connection with spin-off of Citigroup’s Phibro energy trading unit for $370 million to Occidental Petroleum in 2009. In most cases the banks told Feinberg that they were obligated by employment contracts to pay the bonuses and other compensation, but Kenneth R. Feinberg said to reporters that those 17 companies exercised "poor judgment" for making the $1.6 billion in "ill-advised payments" to their top paid employees shortly after accepting TARP funds from the federal government. "They shouldn't have made these payments,'" Feinberg told reporters. "They were ill-advised. They were troublesome." According to the investigation by a law firm the investigation on behalf of current long term investors in American Express Company stock focuses, among other things, on possible shareholder claims that certain of American Express Company‘s senior officers were unjustly enriched through their receipt of unwarranted, excessive or unearned compensation in past years. Certain senior officers and executives at American Express Company were awarded salaries, bonuses, stock options and other forms of long-term, ‘incentive’ In 2007 Kenneth Chenault, CEO and Chairman of the Board of American Express Company since April 2001, earned a total compensation of $50,126,585. In 2008 while American Express Company got $3.39billion in TARP funds Kenneth Chenault received a total compensation of $42,752,461. In 2009, when American Express CO. repaid the $3.39billion TARP funds Kenneth Chenault earned a total compensation of $16,617,639. His base salary has been increased in 2010 from $1,250,000 per annum to $2,000,000 per annum or an increase of 60%. The investigation by the law firm focuses on claims that the prior compensation awarded at American Express Company is now clearly improper based upon its current operating condition. American Express Company reported decreasing Total Revenue from $31.540billion in 2007 to $26.730billion in 2009. Its Net Income declined almost 50% over the same period from $4.126billion in 2007 to $2.137billion in 2009. Shares of American Express Company (AXE) traded in 2007 at over $65 per share and declined in 2009 to as low as $10.26 per share. AXE shares eventually recovered from its low in 2009 and traded recently at $44.55 per share. Finally and most importantly the investigation focuses also on possible claims that would allow American Express Company stockholders to influence or control future compensation decisions at American Express Company. Within the industry huge amounts have been allocated for payout and bonus. Goldman Sachs is reportedly paying out an average of $544,000 per worker, though many could earn several times that amount, JP Morgan Chase’ on average pays about $400,000, and Morgan Stanley pays about $262,000. Morgan Stanley reportedly put aside $8.3 billion for pay and benefits during the first half of 2010, 44% more than during the same period last year. Goldman Sachs put aside $3.8 billion for pay and benefits in the second quarter — equivalent to 43% of total quarterly revenue — in addition to $5.5 billion in the first three months. Those who are current long term investors in American Express Company stock, including those who purchased their AXP shares prior to 2007 and continue to currently hold their AXP shares, have certain options and should contact the Shareholders Foundation, Inc by email mail@shareholdersfoundation.com or call +1(858) 779 – 1554. # # # The Shareholders Foundation, Inc. is an investor advocacy group. We do research related to shareholder issues and inform investors of securities class actions, settlements, judgments, and other legal related news to the stock/financial market. At Shareholders Foundation, Inc. we are in contact with a large number of shareholders. We believe that together we can combine the interests of many investors, and use the size of our interest as leverage against the giant corporations. We offer help, support, and assistance for every shareholder. We help investors find answers to their questions and equitable solutions to their problems. The Shareholders Foundation, Inc. is not a law firm. The information is provided as a public service. It is not intended as legal advice and should not be relied upon. End
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