Five Dumbest Things on Wall Street: March 27

Furniture CEO's Comfy Deal

In all the hullabaloo over executive pay, folks may have missed the one about the unprofitable furniture maker whose CEO gave himself a raise.

Furniture Brands(FBN Quote) paid CEO Ralph Scozzafava $3.8 million in total cash compensation last year, including a 7% salary increase, according to trade magazine Furniture Today.

Scozzafava pocketed the hefty pay package despite sales falling 16.3% at the St. Louis-based company to $1.74 billion in 2008, and a net loss of $415.8 million on continuing operations, a mere eight times its 2007 loss. In December, the company eliminated 1,400 jobs, or about 15% of its remaining U.S. workforce.

Scozzafava joined the company in June 2007 when the company's stock was above $14. The once-proud manufacturer of name-brands like Broyhill, Lane and Thomasville now trades for around 80 cents, and the company sports a piddling $40 million stock market value.

In a story about Scozzafava's bonus deal in Wednesday's Wall Street Journal, a company spokesman said "executive compensation decisions are made by an independent committee of the board of directors, which has been advised by global compensation consultant Towers Perrin."

In other words, it's the consultant's fault the company overpaid its CEO.

That answer had us scratching our heads a little -- OK, a lot -- so we rang up Furniture Brands International and asked them who hired those fair and impartial consultants. To which they kindly replied, "the board."

And who is the chairman of said board? You got it. Ralph Scozzafava.

Don't blame Scozzafava, though. He just hired the people who overpaid him.

Boy did they do their jobs well!

Dumb-o-meter score: 80 -- This furniture company has no legs to stand on when it comes to compensation.