The New York Times is reporting that; triggered by the public fury over bonuses the White House is expected unveil this week a plan for increased oversight of executive pay at all banks, Wall Street firms and possibly other companies. 

The proposal is part of a sweeping plan to overhaul all financial regulations.  What should be most concerning to top executives, (and their lobbyists) is the possibility that the administration might put many of the changes into effect through regulations rather than through legislation.

One of the proposals could impose greater requirements on the boards of companies to tie executive compensation more closely to performance and to take other steps that big bonuses aren't paid before meeting financial goals.

The new rules will include all financial institutions, even those not receiving federal bailout money:

It will propose that many kinds of derivatives and other exotic financial instruments that contributed to the crisis be traded on exchanges or through clearinghouses so they are more transparent and can be more tightly regulated. And to protect consumers, it will call for federal standards for mortgage lenders beyond what the Federal Reserve adopted last year, as well as more aggressive enforcement of the mortgage rules.

The plan is broad reaching

An important part of the plan still under debate is how to regulate the shadow banking system that Wall Street firms use to package and trade mortgage-backed securities, the so-called toxic assets held by many banks and blamed for the credit crisis.

Administration officials are also debating how tightly to supervise hedge funds. A broad consensus has emerged among regulators and administration officials that hedge funds must be registered and more closely monitored, probably by the Securities and Exchange Commission. But officials have not decided how much the funds will have to disclose about their investments and trading practices.

There are hints that complete takeovers of troubled companies could very well happen.

A central aspect of the plan, which has already been announced by the administration, would give the government greater authority to take over and resolve problems at large, troubled companies that are not now regulated by Washington, like insurance companies and hedge funds.

That proposal would, for instance, make it easier for the government to cancel bonus contracts like those given to executives at the American International Group, which have stoked a political furor. Under the proposal, the Treasury secretary would have the authority to seize and wind down a struggling institution after consulting with the president and upon the recommendation of two-thirds of the Federal Reserve board.

The release of the plan is timed to President Obama's first foreign summit meeting in early April and would signal Europe that he intended to crack down on the risk-taking and other free-wheeling practices by the worldwide financial industry.

There is a very strong message here in general, if you want to make a lot of money be a private company, you want to be owned by the public, play by the rules, our rules.

And, to the money changers, what you have done to the world's economy can not, and will not happen again.

Obama Seeks to Increase Oversight of Executive Pay