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AIG Claims It Must Pay Out $165 Million in Bonuses


By

Jen Chung

Published Mar 15, 2009

Modified Mar 15, 2009


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By

Jen Chung

Published Mar 15, 2009

Modified Mar 15, 2009


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Insurer AIG, whose business has been shored up by $170 billion in federal funds, says it is proceeding with $165 million in bonuses to, as the NY Times puts it, "executives in the same business unit that brought the company to the brink of collapse last year." Last week, Treasury Secretary Timothy Geithner told AIG it had to scale back its compensation, but, in a letter yesterday to Geithner, AIG CEO Edward Libby cited legal obligations saying its "hands are tied" and said the government's involvement would make it difficult for the company to retain its best employees. Um, wouldn't most people would understand not getting bonuses for crappy performance? Also, the Wall Street Journal says that bonuses total...$450 million. Naturally, this hits the sweet spot of the government (and public) railing against crazy bonuses—Rep. Barney Frank wants to find out if the bonuses are recoverable. Related: AIG reported a 4th quarter loss of $61 billion.

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AIG

bonus pay

executive compensation

outrage

retention pay


Jen Chung

Jen Chung is a former WNYC and Gothamist editor.

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