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| California, New York ask NYSE's Grasso to resign, renegotiate
NEW YORK, Sept 16 (AFP) - Amid a growing outcry over a 140 million dollar payout to New York Stock Exchange chairman Dick Grasso, state pension officials in California and New York called for his resignation. California Treasurer Phil Angelides also called on the NYSE board to renegotiate Grasso's 140 million dollar compensation package. Serious & personalized business, investment and technology intelligence for a serious advantage - BizVantage! Angelides was joined by Sean Harrigan, president of the CalPERS board of administration and Jack Ehnes, CEO of CalSTERS -- two of the three largest pension funds in the US market with more than a combined 240 billion dollars in assets. "It's out of line with the role of regulator," Angelides said. "It's wrong on the score of transparency." New York State Comptroller Alan Hevesi hours later added his voice to the call for Grasso to step down. "Unfortunately, Chairman Richard Grasso has lost the ability to implement needed reforms at the NYSE and to regulate and monitor its members and listed companies," Hevesi said in a statement. "The enormous amount of his remuneration is inappropriate for a regulator. When an official is paid an extraordinary amount of money by those he is supposed to regulate, there is an obvious conflict of interest. It is also very troubling that the Exchange did not publicly disclose his extremely complicated contract until it was forced to." The announcements were the latest developments in the swirling controversy over the massive payout of pension and other benefits to the stock exchange chief, who is considered a regulator for the nonprofit organization. Grasso said recently he would remain in his job despite critical comments from the Securities and Exchange Commission and shareholder activists. California's Angelides said the package has "shocked the investing public and set back critical efforts to restore the public's faith in our financial system." He said the payout should be restructured "to a level that is rational and appropriate, in order to restore the public's faith in the integrity of the NYSE and America's financial institutions." Angelides pointed out that it would take an average American worker 5,200 years to get the same compensation. The state official said it was troubling to see the massive payout at the same financial markets were being hit by the worst string of corporate scandals since 1929. "We do not believe that Mr. Grasso can continue to lead the New York Stock Exchange," Angelides said. "And, if he remains, we doubt that the New York Stock Exchange will have the requisite moral authority to provide the critical leadership needed in the area of corporate reform." The statements from state officials, who are major investors in the market through pension funds, could add the pressure on Grasso, who has already faced criticism from corporate shareholder activists. Grasso has been under fire since he disclosed the payout August 27. The NYSE disclosed September 9 that Grasso was due, but would not take, an additional 48 million dollars. On Monday, the National Legal and Policy Center -- a corporate shareholder activist group -- called for Grasso to resign. "This level of greed is obscene even by Wall Street standards," said the group's president, Peter Flaherty. "Grasso has reinforced the impression that the market is rigged against the average investor in favor of large firms. "We prefer that the stock exchanges regulate themselves, but when the regulators become fantastically wealthy courtesy of the people they are supposed to regulate, it only invites government regulation." bur-rl/jlp Stocks-US-Grasso-ethics
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