There is now a large combine of states investigating the details of American International Group bonus compensation for executives, a spokesman for the New Jersey State Attorney General's Office said yesterday.
David Wald, speaking for Attorney General Anne Milgram, said Ms. Milgram's office had sent AIG Chief Executive Officer Edward Liddy the state Senate's demand letter seeking information about who obtained what compensation, the source of the money, copies employment contracts and holdings of executive officers.
He said it was the start of an investigation and information that New Jersey secured would be shared with the other state's attorneys general "rather than everybody jumping on." He said 19 states are involved with New Jersey.
The effort, he said, will be to determine whether there are impacts at a state level from AIG's use of federal taxpayer monies. He noted that New Jersey has a broad consumer fraud act and said the inquiry will probe whether the company had made misrepresentations.
Prior to New Jersey's action, New York Attorney General Andrew Cuomo, who had previously been examining the companies activities, announced yesterday that he had been supplied with a list of names of AIG bonus recipients in his probe of the company.
Mr. Wald said New Jersey would welcome working with Mr. Cuomo, but he was not part of the group involving New Jersey and the 18 other states.
"We have received and are reviewing the letter from the Attorneys General," said an AIG spokesman.
Connecticut Attorney General Richard Blumenthal said yesterday that his office had demanded that AIG provide his office a list of bonus amounts and recipients, as well as copies of contracts and other information related to their payment.
He said that he will take steps to enforce the subpoena issued today by the Department of Consumer Protection, or others, if AIG failed to provide the information promptly.
"I will subpoena the company to compel release if necessary. AIG must come clean to its owners–the American people," he said in a statement. AIG gave a 79.9 percent interest to the government in exchange for a multi-billion dollar rescue package.
"AIG was categorically wrong when it claimed that state labor law compelled payment of these outrageous, unconscionable bonuses. A provision in Connecticut law requiring double payment for failure to pay wages does not apply to the AIG bonuses. AIG shamefully used this joke of a justification–totally lacking legal merit–to reward financial failure and fiasco.
"I'm angry that AIG relied on a bogus legal interpretation of Connecticut law to richly reward employees whose monstrous, monumental failures destroyed the company and helped undercut the economy. These employees should be shoved out the door, not showered with cash," said Mr. Blumenthal.
His office said his office would be AIG bonus information without the names today and would not be releasing it.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.