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March 22, 2009

AIG bonuses actually $218M, officials say

Filed under: economics — Tags: , , — ManInBlack @ 5:09 pm

NEW HAVEN–The attorney general of Connecticut said Saturday he is asking American International Group Inc. why documents appear to show the company paid $53 million more in bonuses to its financial products division than previously reported.

Documents turned over late Friday show AIG paid $218 million in bonuses last weekend, higher than the $165 million that was previously disclosed, said the office of Attorney General Richard Blumenthal, who had issued a subpoena.

Bonuses were "showered like confetti" on AIG employees, Blumenthal said.

AIG had previously disclosed that the company was contractually obligated to pay a total of about $165 million of previously awarded "retention pay" to employees in the financial products unit, based in Connecticut, by March 15. It said another $55 million in retention pay had already been distributed to about 400 AIG Financial Products employees.

That total of $220 million is about $2 million more than the figure disclosed Friday, and Blumenthal said he was seeking clarification from the company on whether the new papers differ from what was previously reported.

"Unless the number can be explained, it will undercut any lingering rationale the company may have for these unjustified payments," Blumenthal told The Associated Press on Saturday online payday loans.

AIG spokesman Mark Herr declined to comment.

The newly released documents show that the nation's largest insurer, which has received $182.5 billion in federal money to keep it from failing, paid bonuses of more than $1 million to 73 employees, with five of them getting bonuses more than $4 million, Blumenthal said.

The company did not release the names of the employees, citing worker safety.

"The initial number was so outrageous that it will further fuel the justified anger and revulsion that people feel," Blumenthal said. "It simply shows how these people should been shoved out the door, not showered with cash.''

News of the bonuses last week ignited a firestorm, and even some death threats. Congress began action on a bill that would tax 90 per cent of the bonuses, and the company's chief executive urged anyone who received more than $100,000 to return at least half.

Activists are expected to rally at AIG's Wilton office on Saturday to protest the bonuses. A busload are also touring some AIG executives' homes in Connecticut, organizers said.

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