Most AIG execs agree to return $50M in bonuses
NEW YORK -- New York Attorney General Andrew Cuomo hopes more AIG employees will return their bonuses, after 15 of the top 20 bonus recipients at the troubled insurer agreed to return their money.
American International Group employees have agreed to return about $50 million of the $165 million in bonuses awarded earlier this month by the insurer, Cuomo's office said Monday.
At most, Cuomo said his office could hope to recoup $80 million — roughly the amount paid to AIG employees in the U.S. The bonuses were paid out to employees of the financial products division, a global unit that issued derivatives called credit default swaps that helped sink AIG last year.
The agreement to return the money followed a firestorm of criticism and some arm-twisting from New York's attorney general. AIG has come under heavy criticism because the bonuses were given to employees after the company received $170 billion in government bailout money.
Tuesday at 10 a.m. ET, Federal Reserve Chairman Ben Bernanke and Treasury Secretary Tim Geithner make a rare joint appearance at a congressional hearing, which is expected to include sharp questions over the handling of bonuses at AIG while the company was getting taxpayer bailout money.
"I applaud the employees who are returning the bonuses," Cuomo said during a conference call with reporters. "I think they are being responsive to the American people."
Cuomo said 9 of the 10 people receiving the largest awards have agreed to return their bonus. Cuomo said some others have refused to return the money, while others are considering it.
"We are deeply gratified that a vast majority of Financial Products' senior leadership have expressed a willingness to forsake their recent retention payments," wrote AIG spokeswoman Christina Pretto in a statement e-mailed to The Associated Press. She said the company is continuing to review the responses of the other employees.
AIG Chief Executive Edward Liddy told Congress last week that some of the employees were willing to give the money back. But Liddy has expressed concern that the company may not be able to attract and retain talented employees if they believe their compensation is subject to adjustment by the Treasury.
