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 American International Group Inc.'s (NYSE:AIG) CEO Edward Liddy endured his trial by fire before a House subcommittee Wednesday over the issue of the millions in bonuses paid to the company's derivatives unit. With anger at the company raging, Liddy was wise enough to come to Congress with some concessions designed to quell public anger with AIG. Specifically, Liddy said that the company was requesting that recipients of money in AIG Financial Products return 50% of the funds and went on to say that some members of the division had already returned 100% of the retention pay.While Liddy didn't mention who returned the money, three of the top earners have additional incentive to do so after their identities were leaked to the New York Post. The tabloid outed James Haas, whom it affectionately dubbed "Jackpot Jimmy," as well as Douglas Poling and Jonathan Liebergall, all of AIG's financial products unit. In his prepared remarks before the subcommittee, Liddy began by reminding it that AIG's mess was not of his making, saying: "Six months ago, I came out of retirement to help my country. At the government's request, I have had the duty and extraordinary challenge of serving as chairman and chief executive officer of American International Group -- AIG."And then quickly Liddy got to the issue that has sparked so much rancor toward the company:
Liddy then made public a request for "employees of AIG Financial Products to step up and do the right thing. Specifically, I have asked those who received retention payments of $100,000 or more to return at least half of those payments. Some have already stepped forward and offered to give up 100% of their payments." - George White See Webcast of Liddy's testimony here See full prepared remarks See Deal Pipeline story on recouping AIG bonuses
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From: Kt Davis,
Truthfully, Liddy's defense of needing to prevent an "uncontrolled collapse of that business" just sounds like an empty excuse. He now demands that it was the only way he could fully pay back the more deserving taxpayers...yet I have a better idea. Why not pay the taxpayers back more directly? Why the need to pay bonuses to those who have not done their job correctly? http://www.newsy.com/videos/aig_bonus_brawl/
Posted on:
March 18, 2009 4:33 PM
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It seems the federal government is intent on paying in full anyone who has any sort of relationship with AIG (other than shareholders).
It is hopeful the government is not funding new contracts at the financial products division. So, what is it the highly paid experts there are doing to earn their pay? Are they responsible for preparing checks for the Treasury to sign to pay off the counterparties?