ALBANY, N.Y. — Troubled insurance giant American International Group paid bonuses of $1 million or more to 73 employees, including 11 who no longer work for the company, New York Attorney General Andrew Cuomo said Tuesday.
Cuomo subpoenaed information from AIG on Monday to determine whether the payments made over the past weekend constitute fraud under state law. Contracts written last March guaranteed employees 100 percent of their 2007 bonus amounts for 2008, “despite obvious signs that 2008 performance would be disastrous in comparison to the year before,” Cuomo said.
President Barack Obama and Washington lawmakers have blasted AIG for paying more than $160 million in bonuses to employees of its Financial Products division, the unit primarily responsible for the meltdown that led to a federal bailout of the company, while the company has received billions in taxpayer bailout funds.
Cuomo said AIG mailed the retention bonus checks Friday.
In a letter Tuesday to Rep. Barney Frank, chairman of the House Committee on Financial Services, Cuomo outlined the bonus and contract information and asked the panel to take up the issue at a hearing scheduled for today.
“AIG also claims that retention of individuals at Financial Products was vital to unwinding the subsidiary’s business,” Cuomo wrote. But AIG has been unwilling to provide their names, despite his subpoena for the list, making it impossible to test that claim, Cuomo said. He said his office will do “everything necessary” to get the information.
