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Compensation for FINRA Top Executives

July 10, 2017

by Howard Haykin


With the release of FINRA's Annual Financial Report for 2016 and the Management Compensation Committee Report (page 27-28), gawkers and broker-dealer members alike can espy compensation payouts to the regulator's most senior executives. Depending on one's vantage point, it can either be a fascinating or a frustrating experience.


For 2016, FINRA's 11 most senior executives received over $14.5 million - this includes $2.5Mn for outgoing Chair and CEO Rick Ketchum. For 2015, that same figure was over $12.5 million.



Some interesting factoids:


  • In 2015, Rick Ketchum took down $2.9 million, while SEC Chair Mary Jo White was paid $170,400. Ms. White was a government employee paid out of the U.S. Treasury. 


  • In a curious coincidence, in 2005, NASD’s total expenses were $652.5Mn (of which $352.5Mn, or about 54%, represented compensation and benefits), while in 2015, that same exact figure - $652.5Mn – represented only the compensation and benefits portion of the total expenses. Total expenses in 2015 comes to $968.4Mn, so the amounts FINRA paid, and is paying, in comp and benefits has climbed to about 67% of FINRA’s overall expenses. Slicing this data a little differently: in a 10-year period, FINRA’s expenses climbed 48%, while the number of member firms it regulates dropped over 20%. Hmmm. - Alan Wolper for Ulmer Law's


  • Direct Compensation includes Base Salaries and Incentive Compensation:

►  Incentive compensation is an additional “at-risk” compensation that is performance-based and determined in relation to individual achievements and FINRA’s overall performance. Size of actual award varies based on goal achievement, performance, grade level and degree of responsibility within the organization. 


  • Executive comp has moderated since former Chair & CEO was paid $2.9Mn in 2015 when FINRA had a <$39.5Mn> loss. Another CEO, Mary Schapiro was paid $7.3Mn in 2009, including deferred compensation, prior to her becoming Chair of the SECm, where she was paid a salary of $165,000.