The benefactor of the Thain Family Café, former Merrill Lynch CEO John Thain, seems to have become one of the most noteworthy examples of Wall Street greed in the media. His story exposes not only the extravagance of Wall Street, but also the government’s insufficient oversight of the corporate sector.

On Tuesday the Attorney General of New York issued Thain a subpoena, and he may face charges of fraud. He could also be subject to a class-action lawsuit from Merrill’s shareholders.

All this happened on someone’s watch.

After Thain took the reins of Merrill Lynch in 2007, shareholders lauded the Harvard Business School graduate as the right man to clean up the mortgage mess at Merrill, eagerly agreeing to pay him at least $50 million a year for his efforts — after a $15 million signing bonus.

On most accounts, Thain appeared to be worth the money. Certainly, Merrill Lynch’s stock price declined steadily throughout the executive’s tenure, but this decline was attributed to bad decisions made before Thain was hired. While Lehman Brothers stock plummeted into obscurity, shareholders rejoiced as Thain (and the U.S. government) arranged for Bank of America to buy Merrill Lynch. It was a great deal at the time for Merrill shareholders: They were to receive Bank of America stock worth $29 a share, though Merrill stock had been selling for about $21. Thain seemed to have saved Merrill from Lehman’s fate.

But as time went on, Thain’s reputation was tarnished. After Merrill Lynch’s buyout was arranged, both Bank of America and Merrill Lynch received billions in government funds as part of the Troubled Assets Relief Program, or TARP, more commonly called “the bailout.” Despite receiving taxpayer money, Thain paid out an estimated $3 billion to $4 billion in bonuses just days before Merrill Lynch merged with Bank of America.

Not only did Thain pay out about a quarter of the funds received by his company as a part of TARP, but he also suggested that he receive as much as $10 million for himself. After all, he had brokered the deal that had probably saved Merrill. But by that time, Bank of America’s stock was floundering under the weight of the debt obligations it was inheriting from Merrill. When news of his bonus request was leaked to the media, Thain backed down.

On Jan. 22, just after Merrill’s $15.31 billion loss was reported, it was discovered that shortly after being appointed corporate executive officer, Thain had spent $1.22 million refurbishing his office, including $87,000 on mink guest chairs and $1,400 on a parchment trash can. On Jan. 23, Thain resigned from Bank of America.

Thain’s story is not unusual. Several months ago, in a similar exhibition of opulence, GM’s CEOs flew in corporate jets to Washington in order to ask for a government bailout. America’s entire business culture appears to be built upon profligacy, in which both the government and shareholders turn a blind eye to the actions of top executives.

That Thain’s pay and actions were permitted and deemed acceptable only until government money became involved is ridiculous; no publicly traded company should be so wasteful. America’s top executives deserve to be rich, but they do not have the right to become rich at the expense of the companies they run, especially when those companies are accountable to shareholders or the federal government. Major reforms are needed in order to give shareholders more control over executives and to make information about corporate spending more public.

Now, as the economy still teeters on the brink of collapse, Thain’s future and legacy are uncertain. He may face jail time or be forced to pay shareholders for his actions. But, for now, he will remain at his modest 14-bedroom home, relaxing at one of his two pools or riding a golf cart to the beehives where he gathers honey regularly with his son.

Perhaps there he can be safe from the sting of the credit crisis.

Marcus Shak is a freshman in Pierson College.