Spitzer Tells Judge Grasso Owes $112 Million
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New York Attorney General Eliot Spitzer wants former New York Stock Exchange chief Richard Grasso to return nearly $112.2 million from his disputed $187.5 million compensation package for 2003, according to court papers.
Earlier this month, state Supreme Court Justice Charles Ramos ordered Mr. Grasso to repay part of the pay and directed Mr. Spitzer to calculate the amount.
The judge, who is expected to get Mr. Spitzer’s recommendation Thursday, will soon rule on it.
Mr. Spitzer’s total includes $81.5 million in pension payments made to Mr. Grasso in September 2003 and $12.3 million in interest on two loans provided to Mr. Grasso.
There was no immediate comment from Mr. Grasso’s attorney, Gerson A. Zweifach, of Washington, D.C.
The judge said in his October 18 ruling for partial summary judgment that he was “shocked” at one aspect of Mr. Grasso’s defense: That he believed stock-exchange officials were fully aware of all the elements of his compensation as they increased it annually.
Ramos earlier this month also rejected Mr. Grasso’s claim for another $48 million from the exchange.
In trying to recover some of the pay package, Mr. Spitzer said the compensation was unreasonable under laws governing nonprofit organizations and that board members were misled into approving greater compensation. An internal NYSE review known as the Webb Report claimed up to $156.7 million of the package was excessive when compared to most American corporations.
Mr. Grasso has long argued the exchange’s officers were aware of the compensation when it was approved.
The 72-page decision by Mr. Ramos said Mr. Grasso didn’t fully disclose his growing compensation from a Supplemental Executive Retirement Plan. A SERP is an extra retirement fund many companies maintain for their executives.
The decision stated Mr. Grasso’s SERP of $36 million in 1999 grew to more than $100 million in less than three years.
Mr. Spitzer, who is running for governor in New York, said any return of Mr. Grasso’s compensation will be used to help fund a stock-exchange program that educates investors.
