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Disgraced insurer American International Group is poised to pay a string of multi-million-dollar bonuses to executives despite taking US government aid of $180 billion to prevent its total collapse.
The move will increase public anger at firms rewarding top management even while in receipt of funding from the taxpayer. Goldman Sachs, which has also received state aid, is likely to pay record bonuses this year.
AIG, best-known in the UK as the sponsor of Manchester United, is in talks with Washington's newly appointed compensation czar Kenneth Feinberg about the bonuses, which are due to be paid on 15 July.
The insurer says it needs to keep its best staff, arguing that not paying bonuses would harm the company.
Feinberg was appointed last month to oversee the compensation of top executives at seven firms that have received large federal bailouts.
The firms must convince Feinberg "they have struck the right balance to discourage excessive risk taking and reward performance for their top executives", said the US Treasury.
"That process is just beginning now, and Feinberg has begun consulting with those firms about their compensation plans," the statement said, adding the Treasury will not "provide a running commentary on that process."
AIG has already paid bonuses to some people in its controversial financial products arm.
Reader views (1)
Give them money and they will put it in there, about time somone got wise to the greedy B!!!!!!s
- Richard Edmunds, Rayleigh Essex, 10/07/2009 11:43
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