AIG executives repay bonuses
The controversy in the US surrounding the payment of bonuses to senior executives of American International Group (AIG) has been quelled in part with the news that nine of the 10 highest awards will be repaid.
In addition, 15 of the top 20 recipients have agreed to return bonuses, and the Attorney General of New York, Andrew Cuomo, has confirmed that he expects to recover $80 million in monies paid to AIG employees who are US citizens.
This amounts to almost half the $165 million paid out in bonuses by the group earlier this month.
AIG came perilously close to collapse in September of last year, just days after the failure of Lehman Brothers.
At the time there was little option but to rescue the group. Its failure threatened the global economy because AIG had a major role in insuring risk for financial institutions.
So far, the US taxpayer has bailed-out the group to the tune of $170 billion.
The row about bonuses, which AIG insisted it was contractually obliged to pay, gathered pace last week when the US Treasury threatened to deduct $165 million from the latest tranche of AIG’s rescue package, in lieu of the bonus payments made.
Category: Companies News, Insurance News
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