AIG Still Paying For Luxury Suite at Madison Square Garden
Meanwhile, under pressure the company will cancel over 160 events.
October 16, 2008— -- ABC News has learned that the beleaguered insurance company AIG is still paying hundreds of thousands of dollars for a luxury suite at Madison Square Garden, the home of the New York Knicks and Rangers. AIG told ABCNews.com that the contract for the suite was signed in February and is for the exclusive use of its "brokers and clients."
"We have a number of sponsorships and commitments that are all being reviewed right now," said AIG spokesperson Peter Tulupman.
While Tulupman would not confirm how much AIG is paying for the MSG suite, a year-long contract for a "Club Suite" ranges from $225,000 to $500,000. Although AIG is stuck with paying for the suite, Tulupman said it will no longer be used by the company.
Meanwhile, AIG said it will immediately cancel more than 160 planned events, including a $750,000 conference in Las Vegas and a $350,000 sales conference at Sea Island, GA.
AIG CEO Edward Liddy agreed to the action after a meeting today with Attorney General of New York Andrew Cuomo, who is currently investigating AIG. All told the costs of the planned events would have run to more than $8 million, according to Cuomo.
AIG has been the target of national outrage after it was revealed that the company spent $440,000 for a luxury retreat at a California resort just days after receiving an $85 billion bailout from the federal government.
ABC News has also learned of another high-priced AIG junket that took place after the company received the bailout loan. AIG confirmed that on October 3rd, a team of AIG executives accompanied by their wives, flew on private jets to Las Vegas for an insurance conference.
"The taxpayers of this country don't need to fund luxury expenses for business executives," said Cuomo. "After my meeting with Mr. Liddy, he understands the need for reform, and understands the new culture that must be brought to AIG."
