AG Convinces AIG Execs to Give Back $30M in Bonuses

Cuomo hoping to recoup half of the $165 million doled out

Tuesday, Mar 24, 2009  |  Updated 6:11 AM PDT
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Blame Them For Your Empty Wallet

Attorney General Andrew Cuomo's has cowed AIG execs to coughing up enough cash to cover about .001 percent of Obama's recovery plan.

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Nine of the 10 executives who received top bonuses from AIG have agreed to give the money back, New York Attorney General Andrew Cuomo said Monday.

Fifteen of the top 20 bonus recipients also will be returning their bonus money – an estimated $30 million, Cuomo said. 

So far, AIG employees have agreed to return about $50 million. Cuomo said it now seems possible to recoup around $80 million, or nearly half of $165 million paid by the giant insurer on March 15th.

"We have been working our way down the list beginning with the recipients who received the largest bonuses, Cuomo said. 

He also thanked the AIG officials who gave the money back, saying they had set an example for the rest of the company.

"You have done the right thing.  You have done what this country now needs and demands," he said.

American International Group Inc. had received $180 billion in a taxpayer-funded bailout package earlier this year.  AIG's decision to then pay out millions of dollars in bonuses was met with outrage across the country. Lawmkers and the public were demanding that executives return the money.

In what appears to be a bizarre attempt to deflect further scrutiny and attention, the company this week also had its name removed from above the doorway of its Wall Street offices. The move is part of a transition to the name AIU Holdings Ltd.

In response, the House passed a 90-percent tax on the bonus money with Senate legislation in the pipeline.

The top bonus recipient at AIG was paid more than $6.4 million, and the top 10 received a total of $42 million, records indicate.

Cuomo acknowledged that some bonus recipients declined to give back bonuses, especially those overseas who are outside the jurisdiction of New York State.

AIG had argued that it was contractually bound to pay out the over $165 million in bonuses to its employees.  At least 11 of those top bonus recipients have since left, state lawmakers said.

"We are deeply gratified that a vast majority of FP's senior leadership have expressed a willingness to forsake their recent retention payments," AIG spokeswoman Christina Pretto said.

Separately, Connecticut's consumer protection division has subpoenaed AIG, demanding that the contracts and names of employees who received the bonuses be provided by March 27. Gov. M. Jodi Rell has said she wants the division to determine whether the bonuses can be voided under the Connecticut Unfair Trade Practices Act.

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