Pre-Bankruptcy Payouts Under Fire From Government Watchdog

Companies paid some $165 million in retention bonuses to executives in advance of Chapter 11 bankruptcies in 2020, according to an investigation by the Government Accountability Office. Those bonuses were given without any court approval. Retailers account for a hefty fraction of 2020’s pre-bankruptcy bonuses, with J.C. Penney, GNC, Neiman Marcus, Ascena Retail Group, Tailored Brands, and Tuesday Morning paying bonuses ahead of their respective bankruptcies. The GAO recommended that Congress take up the issue and consider making provisions in the U.S. bankruptcy code that would clearly subject such bonuses to court oversight. Read more at Retail Dive.