WASHINGTON--The second highest ranking member of the House Financial Services Committee issued a letter today assailing American International Group for holding lavish meetings while needing a federal bailout, saying AIG "has behaved like a pig at the taxpayer's trough, and it must stop."

The comments of Rep. Paul Kanjorski, D-Pa., chairman of the Capital Markets Subcommittee of the House Financial Services Committee, were made in a letter to Federal Reserve Board Chairman Ben Bernanke.

In the letter, Rep. Kanjorski urged Chairman Bernanke to support the agreement between New York Attorney General Andrew M. Cuomo and AIG aimed at recovering what Rep. Kanjorski said was "improper spending" on agents and brokers, cancel upcoming business junkets, and undertake executive compensation reforms.

In his letter, Rep. Kanjorski suggested that the Fed and Attorney General Cuomo should expand the current initiatives to recoup unnecessary spending by AIG to recover "all unnecessary perks paid by AIG since the time it sought and received government assistance."

Rep. Kanjorski said in his letter that the Fed should also review Attorney General Cuomo's agreement, which deals with state laws, compare it to the executive compensation standards in the new law allowing the federal government to spend up to $700 billion to provide capital and funding to troubled financial institutions, and "impose the stricter of the two on AIG or any other company that receives a direct loan from the Federal Reserve in the future."

Rep. Kanjorski also asked in his letter that the Fed create an ombudsman to deal with consumer complaints relating to AIG, its affiliates and subsidiaries, and any other company receiving assistance from the Federal Reserve.

He noted in his letter that he received a call from a constituent, a retiree who was involved in a car accident.

"An AIG company insured the driver at fault, and the retiree is now being told that AIG does not have the money to pay the claim," Rep. Kanjorski said in his letter. "We both know this information is false, and even if the company were in bankruptcy, state guarantee funds are in place to provide payment on all legitimate insurance claims," he said.

"There is, however, confusion in the public's mind on these matters and the Federal Reserve should create an office to deal with such situations, as well as to collect complaints about excessive and unnecessary expenditures by AIG and other similarly situated entities," Rep. Kanjorski said.

An AIG official did not immediately respond to a request for comment on the allegations.

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Rep. Kanjorski Calls AIG Piggish

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