AIG’s bonus scandal reignited by US investigations
AIG’s bonuses it claimed retained key staff also went to workers at the troubled Financial Products unit, including a $7,700 bonus to a kitchen assistant in March, the FT reports.
The report, by Neil Barofsky, special inspector-general for the US government’s $700bn troubled assets relief programme (TARP), is due out today.
Barofsky said about 400 employees of AIG’s Financial Products arm shared the more than $168m after AIG had been bailed out by the US government.
Failure by regulators
Bloomberg said Barfosky’s reports says there was a “failure of communication” between Treasury and Federal Reserve Bank of New York officials regulating the bailed-out company.
He said the Treasury’s failure “created considerable public and congressional concern over the retention payments. There is nothing to indicate that Treasury Department officials took any independent steps to assess broadly the amount or scope of AIG’s compensation obligations.”
The Wall Street Journal reports that AIG staff who were asked to repay the bonuses at the height of the scandal have only repaid $19m of $45m.
Pay czar to decide
Kenneth Feinberg, the US executive par czar, is to decide on AIG’s next round of pay and bonuses soon.
