WASHINGTON (CNN) – Executives of companies receiving federal bailout money will have their pay capped at $500,000 under a financial compensation plan that President Barack Obama is expected to announce Wednesday, two senior administration officials said.
Obama himself alluded to a change in executive salary in an interview with CNN's Anderson Cooper Tuesday night.
"Tomorrow I'm going to be talking about executive compensation and changes we're going to be making there," he said. "We've now learned that people are still getting huge bonuses despite the fact that they're getting taxpayer money, which I think infuriates the public."
Under the president's plan, companies that want to pay their executives more than $500,000 will have to do so through stocks that cannot be sold until the companies pay back the money they borrow from the government.
The restrictions will most affect large companies that receive "exceptional assistance," such as Citigroup.
The struggling banking giant has taken about $45 billion from the government's Troubled Asset Relief Program.
Last month, the bank reversed plans to accept delivery of a new $42 million corporate jet, after Treasury Department prodding.
The new rules also will mandate that shareholders of banks have a greater say about the salaries paid to company heads. The measures will put in place greater transparency for costs such as holiday parties and office renovations.
Institutions that are financially healthy - and receive more generally available government funds - can waive these requirements if their shareholders vote to do so, according to the plan.
Last month, Obama ripped Wall Street executives for their "shameful" decision to hand out $18 billion in bonuses in 2008.
The president said it was the "height of irresponsibility" for executives to pay bonuses when their companies were asking for help from Washington.
"The American people understand we've got a big hole that we've got to dig ourselves out of, but they don't like the idea that people are digging a bigger hole even as they're being asked to fill it up," he added.
Congress also was furious, with Sen. Claire McCaskill, D-Missouri, introducing legislation to cap compensation at bailed-out companies to no more than the salary of the U.S. president.
Obama's annual salary is $400,000.
"We have a bunch of idiots on Wall Street that are kicking sand in the face of the American taxpayer," an enraged McCaskill said on the floor of the Senate on Friday. "They don't get it. These people are idiots. You can't use taxpayer money to pay out $18 billion in bonuses."