Stephen Trauber, Citigroup Banker, Reportedly Getting Pay Package Worth Up To $30 Million

UPDATE: A Citigroup spokesman told the Huffington Post that it it did not make a multi-year guarantee to Trauber and that it did not confirm that Trauber would earn at least $9 million for 2010. This story has been updated to reflect the above.

Citigroup, still partially owned by the government, has reportedly agreed to spend up to $30 million on a new hire. Stephen Trauber, lately an energy banker at UBS in Houston, will enjoy that generous pay package at Citi over the span of three years -- but not without a few months of vacation first, the Wall Street Journal reports.

Trauber, who the WSJ says is "regarded as one of the best-connected energy bankers in Houston," will make at least $9 million for 2010, the WSJ says, despite starting his stint at Citigroup at end of the year. The logic of this compensation, the WSJ notes, is that UBS won't be paying Trauber the bonus he would have received there, compelling Citi to make up the difference.

Trauber might have stayed on at UBS if the bank had agreed to grant his compensation requests, which included 150 hours of private plane-access and special bonuses for his closest associates, the WSJ says. But Trauber told Bloomberg, he didn't care about the money. What he really wanted was that his colleagues get paid, and when that didn't happen, the whole gang left for Citi.

Before he starts his new job, Trauber will recharge his batteries during a two- or three-month vacation, beginning in the middle of September according to Bloomberg. He plans to spend part of that break, necessitated by non-compete agreements, playing golf with his team at his vacation house in Cabo San Lucas, Mexico. "The most attractive part of this is a couple months off," he told Bloomberg. "I haven't had a couple months off since college."

The government, meanwhile, owns 17.5 percent of Citigroup, and the WSJ notes that this means the bank is subject to executive compensation rules for the 25 best-paid workers, but it's not clear whether Trauber would qualify. The Financial Times reported yesterday that the government is having trouble selling the 4.2 billion shares it still owns (as of the end of August). The flagging stock market has made the U.S. Treasury slow its gradual sale of Citi shares, meaning the government is set to miss its year-end deadline for giving up its stake in the company. The FT says the government might be considering drastic alternatives, like selling its shares all at once.

For his first year at Citi, Trauber will have earned nine million times the salary of CEO Vikram Pandit, whose 2010 salary and bonus combined was just one dollar.

Comments

[copperswife]

11:23 AM on 10/23/2010

fOK. Get the gist of the article. But one think I still don't understand is whether or not the false documents submitted to the courts amounts to fraud and/or a crime? When I hear things like "procedural errors" I think of an "A + B + C" type thing where a mistake was made; this seems way over the top for that. And what about the notaries (my best friend is one) that "notarized" signatures not made in their presence or even in the same building...I was told $25K per violation. That's a lot of revenue for struggling states??

[KPMan]

01:44 PM on 10/22/2010

Wow...so Tauber gets paid $300K per day in Dec. And according to an article I just read, Vikram Pandit is also making big bucks...almost $105K per day (http://www.knowyourmortgagebanker.com/banks/citi). I am not as familiar with energy banking - what does this fellow do that is so special to be paid so much? I have my money in Citibank and when I read this stuff it worries me.

[charles116]

10:27 PM on 10/09/2010

Please, don't take my private-plane access. Please, I beg you.

[whitemerlot]

09:45 PM on 09/28/2010

"Trauber, who the WSJ says is "regarded as one of the best-connected energy bankers in Houston," will make at least $9 million for 2010"

You see kids- your ability in math or science, your efforts at school, your natural interests, etc. aren't the key to the big bucks... it all comes down to who you know. And if you happen to be born rich already and your parents can introduce you to everyone you need to know, you're set for life. Equality of opportunity in America??? Just a pipe dream.

[Scent]

03:40 PM on 09/28/2010

"The logic of this compensation, the WSJ notes, is that UBS won't be paying Trauber the bonus he would have received there, compelling Citi to make up the difference. "

There IS NO LOGIC. It is a crime he and the ones who agreed to him getting that money should go to jail for.

[floodmfx]

08:05 AM on 09/28/2010

Because the American tax-payer saved these banks -
they learned nothing.

We should have let them go out of business. The bail-outs should never have happened.
Yes, the financial crisis would have been much worse -
but when it was over, the culture of greed and corruption that has infested our financial sector would have been destroyed.

instead, we bailed them out - and the sick culture of greed remains.

[changling]

07:11 AM on 09/28/2010

More chunks of our money going to people who will then take it out of our country.
What can we do to stop the bleeding?

[mrclark]

09:38 PM on 09/27/2010

This man earned his money, you can ask Tim Geithner.

[vippy]

08:57 PM on 09/27/2010

A slap in our face.  People are struggling because we had to bail out the bankers who mismanaged and cheated and then pulled off the biggest heist ever and then they let us know they even get more money than they can ever spend.  Time to rise up and show them without us they are nothing.  But most people don't care, there are even those who claim they deserve this money.  We are indeed brainwashed
and this is the result.  

[jinjinpinti]

07:53 PM on 09/27/2010

Whew. I'm really relieved knowing that Trauber will now be able to commence the remodel on that 7th bathroom in that 12th villa.

[pfrogger]

06:53 PM on 09/27/2010

UBS!!!???
the bank that allowed the rich to hide their money and not pay taxes, ie. stealing from america.

ya, he'll fit in perfectly at Citi. they're also stealing from america. of course it's all legal. laws written by the thieves and liars who are destroying america. yup, more american exceptionalism.

[danusgram]

05:56 PM on 09/27/2010

So many of Citigroup jobs were sent to India and Americans put out of work. Last week Obama was criticized for wanting to penalize companies like this and bring those jobs back to America. Citi dismantled the working careers of many so that they could give payouts like this...they felt paying an employee $13.50 per hour was too much to give employees.

[tresluv]

06:43 PM on 09/27/2010

F&F, danusgram. Some of the comments on this thread offer a vivid illustration of everything that is wrong with this country.

[othel]

05:20 PM on 09/27/2010

I guess I don't have a problem (well no more than most people anyway) if this guy gets a $9 million per year salary but what really cranks me is the $50 million "bonus" he'll probably get if Citi starts to make a little money and all this guy has done is be in the right place at the right time.

[Realistsofly]

04:35 PM on 09/27/2010

I can not understand for the life of me why Citi would pay a "new hire" 30mil but can't pay the regular employees a decent salary. One mintue we going through budget cuts and then the next we're over staffed.. now I see why the budget cuts were in order - ie. no new computers. What does this guy do again? Yeah nothing just like the rest of the tog dogs. It's small shrimp like myself that truly care about the avg. homeowner and take the time to figure out this thing called unapplied funds or missing payments when it's not really our job function. We should be getting paid millions instead a of 2% increase. 30 million dollars should be invested into the company to make sure "the right hand knows what the left hand is doing". What will this guy to EARN the 30 million that the rest of us have not done? Can someone please tell me what sense this makes?

[Gary James]

04:58 PM on 09/27/2010

The amount of money he is going to bring Citi will pail in comparison to his salary. Your argument is kind of silly it's like questioning why the best performers in the NBA make more than the supporting casts on their teams.

[Realistsofly]

05:07 PM on 09/27/2010

That is incorrect what brings more money to Citi is customer assurance.. a customer knowing that their accounts will not be mishandeled leads to more business such as word of mouth. Why amount of money will he bring if customers continue to complain about no one know what the hell they are doing in the company. I don't care if he is a "top" performer in his other company..that does not mean he can stand up to the demands of the new job and provide that same quality. So let me understand you .. are you saying it's O.K. for a company to pay 30million a single indivdual in hopes that he will bring business to the company?

[pfrogger]

06:55 PM on 09/27/2010

america, the beacon of greed.
it's just about the money. that's the ONE and ONLY thing that matters.
MONEY!!!

[Ryan74]

03:24 PM on 09/27/2010

People are paid what they're worth, with the exception of government jobs (where they are often over-paid). Your salary is basically directly proportionate to the amount of revenue the company thinks you will generate for them. They typically don't pay people more money than they bring in, so if Citi has determined that this guy is worth multi-millions, congratulations to him and to Citi for snagging him from UBS. That's just the way things go.

[Juliane]

04:08 PM on 09/27/2010

Are you nutssss....

[Ryan74]

04:41 PM on 09/27/2010

No, I just understand the fact that incentives matter.

[danusgram]

05:59 PM on 09/27/2010

But it is who they value that is wrong...they donot value the people in the front lines that keep their customers there...They sent those jobs to bankrupt Vankrupt to India from an average pittance of a wage of 13.50 per hour to 3.00 per hour!

[Ryan74]

06:30 PM on 09/27/2010

There are plenty of people out there capable of working in a call center or as a bank teller, therefore those skills are not worth as much as the skills it takes to be a leader at a major corporation. You make the big bucks by using your mind in ways most others can't, not by performing physical labor or other unskilled work. I have nothing against "the little guy," I just understand that you can't make the big bucks by being just like the next guy.