NU Online News Service, Aug. 25, 2:46 p.m.EDT

American International Group sought to have the TreasuryDepartment and the “pay czar” tone down criticism of the company,and sought more flexibility in pay and hiring, according to atranscript of a meeting held between the two sides in late November2009.

At the meeting, AIG provided a summary of its employee retentionprograms and an overview of its business recovery and stability,and also raised issues related to compensation structures.

AIG sought an appeal of pay decisions, quick actions on 2010 payrecommendations, and “changes in the tone and content of therhetoric,” according to the transcript.

Robert Benmosche, AIG CEO, starts off the meeting by saying,“People are still here, working to achieve one of the largest andmost significant corporate restructurings in history.”

He adds, “The CEOs are gone. The CFO is gone as well. The headof AIG Financial Products and their lieutenants are also gone.”

Moreover, the transcript goes on, “The people who are here aretrying to right historically successful businesses and fix theproblems that have been left with them.”

A heavily redacted review of the meeting was just releasedthrough a lawsuit by Judicial Watch, which required the TreasuryDepartment to release documents dealing with the meeting.

The court decision also supports the Treasury Department'sdecision to redact most of the summary.

Judicial Watch sought release of the documents because it saysit is “time to shed light on AIG, a corporation owned largely bythe federal government, and thus, owned largely by the public.”

The meeting of the AIG board, its lawyers and other advisorswith Treasury and other officials dealt with AIG's pay practices,which were being criticized by Congress and the general public.

The criticism of the AIG participants was primarily directed atKenneth Feinberg, who was then serving as special master forcompensation programs for the banks, insurance companies and othercompanies that were receiving federal aid under the Trouble AssetRelief Program.

Officials of the Federal Reserve Board who were dealing withAIG, plus representatives of the Fed's outside counsel, alsoparticipated in the meeting, mostly through videoconference.

Feinberg, in carrying out his responsibilities as pay czar undera law enacted by Congress in 2009, had just established pay levelsfor top employees at the troubled companies, including AIG.

He testified in early 2010 before Congress that he “took specialpains” to retain key employees in his rulings on pay at the sevenfirms and added that the lure of giving up cash for company stockthat has a potentially higher value in the future would keep manytop earners on the job.

“Our purpose is to communicate directly with you our reactionsto [Feinberg's pay] determinations largely in terms of what we seeas their effect on our ability to create enterprise value, pay offour debts and leave a viable insurance company standing,” AIGdirectors say on the conference call.