By Michael R. Crittenden Of DOW JONES NEWSWIRES WASHINGTON -(Dow Jones)- Top U.S. House lawmakers are pressuring the Treasury Department to prevent American International Group Inc. (AIG) from distributing hundreds of millions of dollars to executives, saying it violates the terms of the financial rescue legislation passed by Congress in October.
"With the American taxpayers on the hook for billions of dollars invested in AIG, it is unacceptable for the federal government to permit senior executives or former employees to walk away with several million dollars of unsecured, non-qualified compensations in the coming weeks," says a draft letter to be sent to Paulson by lawmakers Friday.
AIG has said it plans to terminate 14 deferred-compensation plans for thousands of employees in the name of ensuring employee retention at a difficult time. The company has faltered in recent months during the financial market turmoil, forcing the federal government to come to its rescue with more than a hundred billion dollars of loans and credit facilities through the Federal Reserve and Treasury.
The letter suggests that that the termination of the compensation plans could enrich AIG's top executives, the firm's lobbyists and some former employees and agents by as much as $360 million. Such a payment should not be made, the letter said.
"Providing millions of dollars in accelerated deferred compensation payments to senior management would be a mistake and we believe these funds should remain at AIG in case the taxpayers need these funds to recoup their investment in the company," the letter said.
Members of Congress have increasingly been criticizing the Treasury for its lax oversight and implementation of the $700 billion financial rescue package. A Government Accountability Office report released earlier this month suggested the federal government had no way of ensuring that firms that receive federal funds were following executive compensation restrictions written into the original law.
The letter was still being circulated for signatures Thursday, though those endorsing it are likely to include top members of the House Financial Services Committee, people familiar with the matter said.
-By Michael R. Crittenden, Dow Jones Newswires; 202-862-9273; michael.crittenden@dowjones.com
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Publié le 18 Décembre 2008 Copyright © 2008 Dowjones