AIG's Liddy Got $460K For Air Commutes, Car Service, Etc.

NU Online News Service, MAY 1, 1:10 p.m. EDT

Financially troubled American International Group, which is due to report its results next Thursday, has filed an amended annual report revealing that Chief Executive Edward Liddy received $460,411 in benefits last year.

The company in its 10-K/A filing with the Securities and Exchange Commission said Mr. Liddy, who is paid only $1 in salary, received $47,578 to pay his air commutes from his Chicago home to AIG's New York headquarters.

Also paid for by AIG were $38,368 for a New York apartment to house Mr. Liddy, $31,348 for car service and $180,431 toward his taxes.

In the past, AIG said it has provided club memberships and recreational opportunities for its executives, "but Mr. Liddy has not participated in these club memberships or recreational opportunities, and AIG has now largely eliminated payments for them."

The report also noted that rather than use a corporate jet, Mr. Liddy generally used commercial air travel to commute.

AIG also paid Mr. Liddy's attorney $162,686 for work "to develop appropriate compensation structures for Mr. Liddy and other AIG senior employees in the current circumstances."

"Although an equity arrangement for Mr. Liddy was substantially negotiated, Mr. Liddy has now stated that he does not think it would be appropriate to enter into the proposed arrangement and has declined to move forward with it, especially in light of changing business, regulatory and legislative considerations," the report said.

AIG said the payments to offset any tax obligation Mr. Liddy incurred for his transportation, living and legal expenses were made "to avoid his effectively having to pay to work at AIG. AIG does not believe that any of the amounts described in this paragraph represents an actual compensation benefit for Mr. Liddy."

The company said its salary committee's review of AIG's practices with respect to perquisites is ongoing and it expects to adopt a formal perquisites policy.

The report said the company's Chief Restructuring Officer Paula Rosput Reynolds had worked on a voluntary basis in 2008 and for 2009 "Ms. Reynolds has a salary of $900,000, which was approved by the committee with the input of Mr. Liddy."

It said that she is paid less than when she served as Safeco CEO. Ms. Reynolds's compensation in 2009 was expected to be tied directly to the progress of restructuring efforts, although this initiative may be affected by the American Recovery and Reinvestment Act bailout legislation.