The Connecticut Attorney General and state lawmakers have issued subpoenas for a dozen AIG executives, including company CEO Edward Liddy. This comes as AIG turns over bonus-related documents to the state.
AIG paid out $165 million in retention bonuses last week to employees in the troubled financial products division located in Wilton, the division blamed for the company's failure. The bonuses came after AIG received $170 billion in bailout money from the government. Now, it appears the total bonus amount may be even higher, says Attorney General Richard Blumenthal, after reviewing documents turned over by AIG. "These people in effect were responsible for one of the greatest corporate collapses in our nation's history," said Blumenthal. "To reward them for failure and provide these payments to them seems totally unjustified."
There appears to be no basis to blame the bonuses on the Connecticut Wage Law, said Blumenthal. The company has said it was obligated under Connecticut law to pay the contractual bonuses, or risk being sued for double the money. "What these documents show is that many of these bonuses went to people who left the company," said Blumenthal. "It couldn't have been to retain them that they were paid, and that they were not linked to any specific task or services such is required under our Connecticut law."
Blumenthal, along with members of the state legislature's Banks Committee, have issued subpoenas for 12 AIG executives, including Liddy, who either received bonuses or have knowledge of why they were paid out. The hearing is scheduled for Thursday, March 26 at the Legislative Office Building in Hartford.
State officials say the names of the others who received subpoenas are James Haas of Fairfield, Jonathan Liebergall of New Canaan, Douglas Polling of Fairfield, Christopher Phole of New Canaan, Steven Pike of Stamford, Robert Powell of Westport, Joseph Rooney of Fairfield, Gregory Ruffa of Darien, Leonid Shekhtnam of Redding, Christian Toft of Weston, and Steven Wagar of Norwalk.
"We've subpoenaed these individuals because they received bonuses, or knew about them, and can explain to us what was done conceivable to justify these bonuses," said Blumenthal.