Feinberg Mum On AIG Bonus Report

Kenneth Feinberg, the Obama Administration compensation czar, would not answer questions today after widespread reports that American International Group will pay millions in bonuses next week.

Mr. Feinberg said by e-mail that he was sorry but he would have no comment concerning articles reporting that the company had spoken to him concerning the bonuses.

The payments of bonuses by the debt-ridden company, which has been propped up by $180 billion in government loans and credits, has been a hot-button issue since March when it was revealed then that it was paying $165 million in retention bonuses to executives at the financial products unit that brought it to the brink of failure.

Mr. Feinberg, a Washington attorney and compensation expert who oversaw payments to families of 9/11 victims, was appointed last month by Treasury to oversee compensation to executives at seven companies now receiving federal assistance.

According to reports, AIG is seeking government approval for $2.4 million in performance bonus payments to 43 executives. The money is part of a larger bonus pool, most of it paid out in March.

When the storm broke in March over the bonuses, the company said that it had a contractual obligation to pay them and they were a needed tool to retain top talent. Eventually the company reported that at least $50 million of the $165 million distributed was returned by U.S. citizens, and foreign employees gave back money as well.

Strong calls for the return of the money had come from political leaders ranging from President Barack Obama to New York Attorney General Andrew Cuomo--who issued subpoenas seeking disclosure of which executives were getting the bonus money and why as Congress threatened retaliatory taxation.

In May, AIG Chief Executive Officer Edward Liddy, who is due to resign his post, mentioned to a congressional committee that the Treasury Department was completing regulations to govern AIG's bonus policy.

AIG did not respond to a request for comment.