Ousted NYSE boss demands apology

FORMER New York Stock Exchange chairman Richard Grasso has offered his ex-employer an olive branch, albeit with a new threat attached, as prosecutors prepare a case for the return of some of the hundreds of millions of dollars he was paid.

Grasso, whose name has become a byword for Wall Street greed and excess, has told Newsweek magazine that he wants an apology from the Exchange.

While he won't pay back any of the money he has already received, he will forgo the $48m (£31.5m) in deferred pay he says the Stock Exchange still owes him, as long as it says he did nothing wrong.

'If I give back a dime, that's an admission of guilt. I can't do that,' he told the magazine in an interview published today.

'But if they say I'm an honourable man and I did nothing wrong, it's the end of the issue. If not, let's go to war.'

Grasso was forced to leave his job as head of the New York Stock Exchange (NYSE) amid outrage over his pay package. He plans to retain the $139.5m he has already been paid and wants an additional $57.7m - including the $48m - out of a total $197.2m pay and severance package.

His departure sparked a review of corporate governance at the exchange which is still being played out.

Caretaker chairman John Reed, who came out of retirement to help salvage the NYSE's reputation, has asked New York attorney general Eliot Spitzer to look at ways to get some of the money back from Grasso.

Spitzer is believed to be looking at a possible case under New York's Not For Profit Corporation Law, which says that the pay at non-profit organisations must be 'reasonable' and 'commensurate with services performed'.

Observers say the case could be launched this week. However, Grasso has indicated that he will not take it lying down and is demanding an apology from the NYSE for 'destroying my reputation'.

In the Newsweek article, he says he is bitter about his treatment and has been hounded by reporters who have staked out his Long Island home for months. 'I've been living in my own private prison,' he says.

Grasso tells the magazine that his case was used as an example of Wall Street greed in one of his daughter's college classes. 'That's when I almost lost it,' he says.

Despite setting the action in train, the NYSE is not totally confident of success in the case. Last week it revealed it had set aside $36m to cover possible severance payments to Grasso and acknowledged that if the case did not go the way it hoped, the provision could rise.