Many of the employees at American International Group Inc.'s (NYSE:AIG) Financial Products unit who received part of the $165 million in retention bonuses have returned them ... and then left the company.
New York Attorney General Andrew Cuomo said in several reports that 15 of the top 20 recipients agreed to give back their bonuses worth about $30 million in cash. Overall, AIG employees have returned about $50 million in bonuses so far. The names of the recipients were not revealed, according to
The Wall Street Journal, but nine out of the 10 top bonus recipients have already returned bonuses, according to
CNBC. There were 463 executives awarded bonuses in all.
But not all of the bonus money will be recovered. Cuomo hopes to recover only about $80 million of the $165 million in bonuses (or possibly the
$218 million in bonus payments, as Bloomberg News reports) that were awarded to employees based in the U.S. The extra $85 million was awarded to employees based outside the U.S., most likely in the London office. Law would keep Cuomo from pursuing those bonus payments.
As CEO Edward Liddy expected around 20 executives resigned from AIG, all of them were employees that returned their retention bonuses. A spokesperson told
The New York Times that she expected more resignations and believes "this situation is manageable."
It's not really surprising that employees are
resigning, considering they now have to deal with death threats at their homes, politicians beating down their door and returning to work only to find that
the name of the company has changed. Liddy had expressed concern that the resignations could make it
harder for AIG to wind down the $1.6 trillion portfolio of derivatives. But perhaps
someone should have considered that before the bonuses were awarded?
- Maria WoehrAlso see:
AIG: What's in a name?AIG employees flee or go into hiding
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