Treasury nominee to keep corporate pay

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By Jim McElhatton

President Obama's nominee for the Treasury Department's top legal job still can receive almost $3 million in pay over the next three years from one of the nation's largest financial-services companies under a compensation plan approved by government ethics lawyers.

If confirmed as the department's next general counsel, George W. Madison would earn a government salary of $153,200 and get an additional $955,000 next year from his previous employer, TIAA-CREF, as a participant in the New York-based company's "long-term compensation plan," according to a government ethics filing.

• Click here to view the financial disclosure form for George Madison. (PDF)

Mr. Madison, who will no longer work for the company where he served as general counsel, will get $1.6 million from TIAA-CREF in 2011 and $333,000 in 2012 under the pay arrangement, government records show.

Mr. Madison's Treasury appointment is pending. According to the Treasury Department, Mr. Madison has agreed not to work on matters that would "affect the ability or willingness" of TIAA-CREF to pay out the $2,918,000 he is slated to receive over the next three years.

Retirement-planning company TIAA-CREF manages more than $300 billion in retirement and other assets for 3.6 million members, mostly working in the medical, research and academic fields. The company has a big presence in Washington, spending more than $1 million to lobby Congress, the White House, the Treasury Department and other agencies over the past year.

Ethics specialists say Mr. Madison's continuing financial relationship with TIAA-CREF, which has lobbied government officials on numerous issues, including the Troubled Asset Relief Program (TARP), deserves close scrutiny, given the company's broad interests on issues in which the Treasury Department holds sway.

"He's counsel to the Treasury, which could confer benefits on the company he previously left; there is an appearance that his judgment could be affected," said Bennett L. Gershman, a government ethics specialist at Pace University in New York. "The way you have to avoid that is, he has to recuse or disqualify himself from any issues involving TIAA-CREF."

Treasury officials said government ethics lawyers approved the deal and that safeguards are in place to avoid any conflicts.

"The department's ethics attorneys, in consultation with the U.S. Office of Government Ethics, have determined that Mr. Madison may retain his interest in the TIAA-CREF deferred-compensation plan," Treasury spokesman Andrew Williams said.