WASHINGTON DC (KOLO) - U.S. Senator Catherine Cortez Masto is helping put forward a bill that would prevent bank executives from collecting paychecks, bonuses, and disregard prudent risk management in the event their bank fails.

She, along with Elizabeth Warren (D-MA), Josh Hawley (R-MO), Ruben Gallego (D-AZ), Katie Britt (R-AL) and eight other Senators introduced The Failed Bank Executive Clawback Act of 2026 on Wednesday.

Under the bill, the Federal Deposit Insurance Corporation would hold the executives of failed banks financially responsible for some of the costs incurred by the failure. The FDIC would then be required to claw back all or a portion of the compensation large bank executives received over a three-year period prior to the bank’s failure.

“Executives at major financial institutions should not get to make out like bandits after running their banks into the ground,” said Senator Cortez Masto. “We saw this happen with Silicon Valley Bank three years ago – when the bank failed, its leadership had already sold millions in company stock. Our bipartisan legislation will ensure these individuals are held accountable for threatening the financial stability of businesses and families in Nevada and nationwide."