Executives at government-rescued AIG who are taking cash perks to remain in their jobs – some as much as $3 million – are lucky even to be employed.
So says Rep. Elijah Cummings (D � Md.), who blasted AIG’s decision to give retention bonuses to 130 managers while the government puts up billions for a rescue makeover.
The firm has been under federal control since it nearly imploded earlier this year, and remains afloat on $153 billion in loans from the government.
In a letter made public yesterday, Cummings – on a congressional watchdog panel – said AIG must reveal all names of the 130 executives getting the perks, and explain why the money is needed to keep them in their jobs, particularly since many laid-off white-collar workers are seeking jobs.
“Taxpayers have a right to know why senior executives at AIG, who are frankly lucky to still have jobs, need to receive additional bonus payments,” Cummings said in his letter to AIG brass.
At least one executive’s name was disclosed in an earlier filing – Jay Wintrob, 51, the head of AIG’s retirement services – who’ll get a retention payment of $3 million spread over the next two years. His unit is also being sold.
The company’s CFO David Herzog also will get a retention bonus, but the size wasn’t disclosed in the filing. AIG didn’t reveal any other names involved or amounts of their awards.
The timing of the perks was awkward at best – just days after the government gave AIG its first chunk of a total $153 billion rescue, in exchange for up to 80 percent control of the company.
As a condition of taking its rescue cash, Congress said AIG and other firms must curtail excessive executive pay and perks.
AIG agreed to freeze bonuses and perks, but days later, AIG disclosed the retention awards.
At the time of the September filing, an AIG spokesman had said the awards to its 130 managers technically aren’t bonuses and don’t violate the spirit of Congress’ will.
Cummings disagreed, and called on CEO Edward Liddy to resign, saying Liddy misled the public. Cummings and his House Committee on Oversight and Government Reform are helping keep tabs on the $8.2 trillion rescue package involving numerous financial companies.
“AIG can dress this money up in fancy names, but no one is fooled,” said Cummings. “A bonus by any other name still stinks.”
Meanwhile, AIG’s former CEO Hank Greenberg also wrote management a letter disclosed yesterday that a glaring hole exists in the rescue package. It involves disclosing which counter-parties are involved in AIG assets and the total amount they’ve drawn from government aid.